Northern District of California | Pennsylvania Resident Convicted Of Conspiracy In Scheme To Defraud And Extort Crypotocurrency Executives
SAN FRANCISCO – Today, Anthony Francis Faulk pleaded guilty to a federal charge of conspiracy in connection with a scheme to defraud more than a dozen executives of cryptocurrency-related companies and cryptocurrency investors of money and other property, announced United States Attorney Stephanie M. Hinds and FBI Special Agent in Charge Robert K. Tripp. The guilty plea was accepted by the Honorable William H. Orrick, United States District Judge.
Faulk, 26, of Latrobe, Penn., acknowledged his role in the conspiracy in a written plea agreement filed with the Court. According to his plea agreement, Faulk admitted from October 2016 through May 2018, he conspired with others to defraud and extort cryptocurrencies and other money from executives of cryptocurrency-related companies and cryptocurrency investors. Faulk acknowledged that the scheme involved extortion as well as “SIM swapping,” whereby Faulk and his co-conspirators gained access to their victims’ email, electronic storage, and other accounts to defraud the victims of their property.
SIM stands for Subscriber Identity Module or Subscriber Identification Module. A SIM card is a technology used to identify and authenticate subscribers on mobile phone devices. According to his plea agreement, Faulk admitted that he used fraud, deception, and social engineering techniques to induce representatives of cellphone service providers to transfer or port cellphone numbers from SIM cards in the devices possessed by victims into SIM cards of devices possessed by members of the conspiracy. Once in possession of the illegally obtained information, members of the conspiracy reset passwords of their victims’ email, electronic storage, and other accounts. The co-conspirators then were able to control the accounts, access cryptocurrency accounts, and transfer cryptocurrencies from accounts owned by the victims to accounts, or wallets, controlled by Faulk and his co-conspirators.
Further, Faulk admitted that in addition to transferring cryptocurrencies, the co-conspirators also contacted some of their victims by telephone and threatened to compromise further accounts unless the victims paid additional money to the fraudsters.
In the plea agreement, Faulk agreed to forfeit a home in Pennsylvania valued at approximately $942,500, two bank accounts with a combined value of more than $18,500,000, luxury cars, jewelry, and other property – all constituting or is derived from proceeds traceable to the conspiracy.
On December 10, 2019, a federal grand jury indicted Faulk, charging him with one count of conspiracy to commit wire fraud, in violation of 18 U.S. C. § 1349, and one count of interstate communications with intent to extort, in violation of 18 U.S.C. § 875(d). Pursuant to his plea agreement, Faulk pleaded guilty to the conspiracy count. If Faulk complies with the terms of the agreement, the extortion count will be dismissed at sentencing.
Faulk remains free on bail pending his sentencing. Judge Orrick scheduled the sentencing for June 8, 2023. Faulk faces a statutory maximum sentence of 20 years in prison and a maximum fine of twice the gain or loss realized from his crimes. In addition, the court could order Faulk to serve a maximum three-year term of supervised release, restitution, and other penalties. However, any sentence will be imposed by the court only after consideration of the U.S. Sentencing Guidelines and the federal statute governing the imposition of a sentence, 18 U.S.C. § 3553.
Assistant United States Attorney Robert Leach is prosecuting the case. This case is the result of an investigation from FBI, along with significant assistance from the Santa Clara County District Attorney’s Office’s REACT Task Force.
