U.S. Justice Department accused North Korean agents of embezzling $900,000 from crypto startup

The US Department of Justice has charged four North Korean nationals who, disguised as IT specialists, infiltrated a US crypto startup and stole $900,000. They are charged with five episodes of electronic fraud and money laundering.

According to investigators, the group first operated out of the UAE and then formalized as remote employees at cryptocurrency companies from the United States and Serbia. After gaining trust, the agents carried out two separate hacks in 2022 – for $175,000 and $740,000. Funds were laundered through crypto exchanges and mixers using fake identities.

U.S. authorities believe that this is a state operation: the funds received were allegedly used to finance North Korean weapons programs.

Chainalysis explained that agents disguise their origins, use fake documents and act carefully: first they work off a formal salary and then wait for the right moment to gain access to the company’s systems. Web3 startups that hire employees without thorough background checks are particularly vulnerable.

As part of the investigation, U.S. authorities conducted a large-scale operation in early June, covering 16 states. They seized 29 bank accounts, 21 fraudulent websites and about 200 remote workstations through which agents disguised their actions as activity from the United States. Investigators estimate that such schemes have already brought tens of millions of dollars to the DPRK.