Man Loses £750,000 in ‘Cryptomugging’

The UK has seen more “cryptomugging” victims lately, with robbers coming for the phones of cryptocurrency investors – grabbing them out of the victims’ hands.

The Independent reported two such cases. In the case of Toby Atkinson (alias), a robber snatched his unlocked phone from his hands as he was heading home from after-work drinks.

Atkinson started investing in crypto after his mother gave him £100 for his 16th birthday. Now 30 years old, he says he had turned that pocket money into “well over a million” thanks to being an early adopter.

He chased the robber down the alley, only to be faced with two additional gang members wielding a knife and a machete. A scene straight out of a movie. Over the next 40 minutes, the trio went through Atkinson’s apps, forcing him to transfer out the funds: in total, £750,000 (nearly a million USD).

Furthermore, Atkinson claimed he typically kept his crypto “on a cold storage, on a USB stick.” He took it off to put a deposit down on a house. “It’s not just a case of money, but everything I hold private that was stored on my phone. I felt physically and emotionally assaulted,” he stated.

Similarly, Sam Kelly (alias), who had “invested a five-figure sum,” was ordering an Uber home. Again, a man ran past him and grabbed the unlocked phone out of Kelly’s hands. Though he tried following the fast snatcher, he also noticed two other men following.

Therefore, Kelly hurried home to deactivate his accounts, but there was no money left. “I still don’t know how they managed to do it so quickly,” he said, adding that he had enabled security settings on the accounts, and that the thieves possibly used “passwords stored elsewhere in [the] phone.”

Per the report, some 225 phones are stolen in Britain on average each day. But lately, these thieves are after crypto apps.

The report cited David Gerard, author of Attack of the 50 Foot Blockchain, saying that unlike online bank accounts, which are difficult to enter, crypto apps are “like carrying around little lumps of gold […] It is so stupidly brittle. These are not reversible transactions. Would you go down to the pub with £10,000 cash in your pocket? Probably not. You need to treat crypto like a big pile of money.”

Meanwhile, Atkinson and Kelly went to the police, but both said they had a bad experience with unhelpful officers.

However, Phil Ariss, Former Crypto Lead for the NPCC Cybercrime Programme and Director of UK Public Sector Relations for TRM Labs, says that the police, in fact, have special tools to track the stolen assets as soon as thieves try to cash out.

Notably, cryptomugging is not new. The Guardian reported on several such cases two years ago. The technology has developed exponentially since then.

Also, seven members of a UK gang were sentenced this January to lengthy prison terms for kidnapping, torturing, and extorting a crypto investor. It’s only among the latest of many crypto-related cases that law enforcement has solved.

#JAILED | Criminal gang who kidnapped vulnerable man for cryptocurrency jailed for 76 years

Today (Thursday 30 January) the men appeared at Manchester Crown Court to be sentenced for their roles.

More: https://t.co/RNT4WVaIGn pic.twitter.com/GaIWLPsgdB

Meanwhile, Kelly filed complaints with the Financial Ombudsman Service and the two unnamed companies whose apps he had installed, and the thieves accessed despite the security measures. He managed to get “well over half of [the funds] back, Kelly said.

However, because Atkinson made the transactions himself during the cryptomugging, even if under threat, he could not file similar complaints.

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