As reported by the New Zealand Herald, hackers stole 1.34 Bitcoin worth $32,000 from a New Zealand police crypto wallet. Reportedly, this wallet will be used in a money-laundering investigation.
New Zealand police lost $32,000 in Bitcoin when an online investigation went wrong
National Criminal Investigation Group intercepts and technology operations manager Detective Inspector Stuart Mills said: “Police has committed to learning from this incident, and to introducing stronger processes so that it does not happen again.”
Detective Inspector Stuart Mills of the Police’s National Organised Crime Group
Mills said police had purchased Bitcoin for $32,000 for use in an investigation. He said it was discovered in late 2020 that the money was gone. The money was fraudulently obtained from a police Bitcoin wallet during an operation aimed at money laundering.
As such, the police intended to use BTC in an undercover controlled purchase of illicit drugs. However, a non-police entity purportedly obtained control of the private keys necessary to access the wallet and withdrew the cryptocurrency for themselves.
Police still don’t know who stole the BTC, although Mills said the subjects were likely living abroad and the offending was part of a wider fraud targeting Bitcoin wallets.
“The offenders have not yet been identified,” Mills said.
The most likely option was that a controlled purchase went wrong and those the police sought to entrap disappeared with the money without supplying the goods or services. Investigations into where the money went and how the perpetrators compromised the private key are still ongoing.
It should be noted that the police are not entirely unfamiliar with cryptocurrencies. Last year, New Zealand authorities seized approximately $90 million worth of BTC from Alexander Vinnik, the alleged operator of the now-closed crypto exchange BTC-e who is to serve five years in prison for crypto-based ransomware fraud.
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