The US Federal Bureau of Investigation (FBI) says it has the private keys to nearly $190 million worth of Bitcoin, which had been bought with cash allegedly embezzled from Sony’s life insurance subsidiary.
According to prosecutors, Sony Life employee Rei Ishii falsified transaction instructions to fraudulently authorize transfer of around ¥17 billion ($149 million) in company funds.
Ishii allegedly directed the funds to a La Jolla, California bank account in May 2021 before exchanging them for Bitcoin.
On Monday, the Department of Justice (DoJ) filed a civil forfeiture to return the Bitcoin to Tokyo-headquartered Sony Life, or at least the funds used to buy it.
“It is our intent to return the stolen money to the victim of this audacious theft, and today’s action helps us do that,” said Acting US Attorney, Randy Grossman.
“Criminals should take note you cannot rely on cryptocurrency to hide your ill-gotten gains from law enforcement. The United States coordinates extensively with its international partners to forestall crime and retrieve stolen funds,” Grossman added.
FBI ‘obtains’ a lot of Bitcoin private keys
According to a statement issued by Sony Life, Ishii was arrested by Tokyo Metropolitan Police on November 29. This was the result of a joint collab by Japanese and US investigators.
FBI special agent in charge Suzanne Turner said both Sony and Citibank cooperated with law enforcement to track the missing millions.
- The investigation began following Sony’s discovery of the missing funds in August.
- The FBI seized 3,879.16 BTC ($188.9 million) on December 1.
- Thanks to a Bitcoin price rally, the funds are now worth over $190 million — 25% more than in May.
“The FBI’s technical expertise was able to trace the money to the subject’s crypto wallet and seize those funds,” she added.
Predictably, the FBI continues to keep its apparent ability to obtain Bitcoin private keys a secret.
In this case, it could’ve worked with Ishii’s chosen crypto exchange to retrieve the funds, or seized computer hardware that contained their Bitcoin private keys.
In May (the same month that Sony’s funds went missing), the FBI recovered a Bitcoin ransom paid to Russia-linked DarkSide.
DarkSide hijacked the systems of major gas seller Colonial Pipeline, which cut off almost half of the US East Coast’s gas supply.
In that case, the FBI also “obtained” a private key to recover just over 63 BTC ($3.1 million). This represented around half of the ransom paid to DarkSide.
The agency refused to give up its tradecraft when asked by journalists how they learned of DarkSide’s private key (or its 12-word crypto password).
This led to erroneous reports that suggested the FBI had “cracked” Bitcoin.
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