US prosecutors charged a Moroccan man with stealing $450,000 in cryptocurrency and nonfungible tokens, including two Bored Apes, by creating a fake replica of the OpenSea digital marketplace in 2021.
Soufiane Oulahyane, 25, set up the website to trick victims into revealing the seed phrase — a series of random words that open a crypto wallet — to gain access to actual accounts on OpenSea, the largest marketplace for NFTs, the Department of Justice said Monday.
The practice is known as “spoofing,” which is “one of the oldest tricks in the criminal playbook,” Manhattan US Attorney Damian Williams said in the statement. “Oulahyane adapted this old tool for use in a new and developing arena — the crypto space.”
Crypto-related frauds are expanding their presence on the criminal docket as more people hold virtual assets. Prosecutors in May won the first-ever insider-trading trial, against former OpenSea employee Nathaniel Chastain, who was convicted of trading on confidential information about which tokens were to be featured on the marketplace’s home page.
Prosecutors charged Oulahyane with stealing cryptocurrency from the wallet of a victim in New York, who wasn’t identified. He also sold 39 of the victim’s NFTs on OpenSea, including a cartoon ape in sailor cap smoking a cigar, the DOJ said. Another pictured a robot dog with a missile battery mounted on its head, the government said.
Oulahyane paid for sponsored links on an unidentified search engine, according to the government. Users who clicked on the link were allegedly directed to a phony site that looked like OpenSea’s login page. The victim entered the seed phrase, which was immediately sent to Oulahyane.
The victim paid 9.88 Ether, or about $18,700, for the ape and 1.789 Ether, or $3,400, for the dog, according to prosecutors. Ether is the native cryptocurrency of the Ethereum blockchain.
Oulahyane is charged with wire fraud, use of an unauthorized access device, aggravated identity theft and use of an access device to steal at least $1,000. The fraud charge carries a maximum 20 years in prison.
The case is USA v. Oulahyane, 23-cr-215, US District Court, Southern District of New York (Manhattan).
