DOJ indicts 12 more in $236M crypto crime ring

The DOJ on Thursday charged 12 additional defendants in connection with a cybercrime ring that allegedly stole more than $263 million in crypto. U.S. prosecutors said the gang siphoned the funds through a sophisticated social engineering and hacking operation and spent the proceeds on expensive cars, nightclub blowouts, and luxury goods.According to the indictment, the gang started around October 2023 and continued through March 2025. The enterprise grew from friendships developed on online gaming platforms. The authorities revealed the gang is accused of committing crimes, including racketeering, wire fraud, and obstruction of justice.DOJ charges 12 more individuals from a cybercrime ringAdditional 12 Defendants Charged in RICO Conspiracy for over $263 Million Cryptocurrency Thefts, Money Laundering, Home Break-Ins https://t.co/5jPyk1XN6A@USAttyPirro @FBIWFO @IRS_CI @FBILosAngeles @FBIMiamiFL pic.twitter.com/WLP84c0bZp— U.S. Attorney DC (@USAO_DC) May 15, 2025The DOJ said the superseding indictment adds charges originally brought against Malone Lam on September 19, 2024.The additional individuals arrested alongside Lam include U.S. citizens and foreign nationals. Arrests were made in California, and warrants were issued for two individuals believed to be in Dubai. The indictment noted that all but one are aged between 18 and 21, with two defendants’ identities unknown beyond their online pseudonyms. The indictment revealed that the members held different responsibilities, including database hackers, organizers, target identifiers, callers, money launderers, and residential burglars targeting hardware virtual currency wallets.Of the thirteen defendants, twelve face RICO conspiracy charges, nine have an additional charge of conspiracy to launder monetary instruments and eight face conspiracy charges to commit wire fraud. One last defendant, 19-year-old John Tucker Desmond, is charged with obstruction of justice for destroying evidence.The indictment alleged that the gang laundered the stolen virtual currency proceeds by moving funds through various mixers and exchanges using peel chains, pass-through wallets, and virtual private networks to mask their true identities.The indictment revealed that gang members used the stolen digital assets to purchase nightclub services ranging up to $500,000 per evening, luxury handbags they gave away at nightclub parties, and luxury watches and clothing. The enterprise also spent the funds on rental homes in Los Angeles, the Hamptons, and Miami, private jet rentals, a team of private security guards, and a fleet of at least 28 exotic cars, some valued up to $3.8 million.Indictment notes various crimes committed by the gangThe prosecutors alleged that in one instance, on August 18, 2024, Malone Lam contacted a victim in D.C. and fraudulently obtained over 4,100 Bitcoin (worth over $230M at the time). The defendant is also accused of another instance in July 2024, where he and others stole over $14 million in digital currencies from an additional victim.One gang member, Marlon Ferro, 19, is also accused of committing home break-ins to steal hardware cryptocurrency wallets. The indictment noted that in one instance, Ferro traveled to New Mexico in July 2024 and broke into a victim’s home to steal their hardware digital asset wallet, while Lam monitored the victim’s location by logging into his iCloud account.The authorities accused Kunal Mehta, Hamza Doost, Joel Cortez, and Evan Tangeman of allegedly engaging in unlicensed crypto-to-cash services for the gang. The indictment noted that the individuals obtained luxury rental homes for enterprise members using fake identity documents, booked private jet travel with the stolen crypto for the gang, and concealed ownership of exotic cars by registering them in shell company names. The gang also shipped bulk cash through U.S. mail to enterprise members hidden in Squishmallows stuffed animals.Lam is also alleged to have continued working with the gang while in pretrial detention after his arrest in September 2024. The indictment alleged that Lam worked with members to pass and receive directions, collect stolen virtual assets, and have enterprise members buy luxury Hermes Birkin bags and hand deliver them to his girlfriend in Miami, Florida.Cryptopolitan Academy: Want to grow your money in 2025? Learn how to do it with DeFi in our upcoming webclass. Save Your Spot