after making bail “SIM Swap Suspect Released on Bail in Large-Scale Case”


On Friday, a man from the Chicago area who was charged in the $400 million hack of the bankrupt crypto currency exchange FTX was released to home confinement. The court ordered him to refrain from non-essential internet use and online gambling. Robert Powell, a 26-year-old from Highland Park, was indicted for participating in a sophisticated SIM swap scheme that allegedly stole $400 million in virtual currency from one company and millions more from other victims.

The indictment, first reported by the Tribune on Tuesday, did not name the victimized company, but it occurred on the same day that FTX, owned by convicted fraudster Sam Bankman-Fried, went bankrupt in 2022. There was speculation at the time that the hack was an inside job, and a source has confirmed that FTX was the victim in Powell’s case. Powell was arrested quietly in the Chicago area last week, while the indictment was still under seal.

At his detention hearing on Friday at the Dirksen U.S. Courthouse, Powell appeared in red and white jail clothes and answered the judge’s questions about his bond clearly. As part of his release conditions, Powell must remain inside his home except for court appearances or medical purposes. He is also only allowed to access the internet on one device, and only for communication with family or job searching. His lawyer, Gal Pissetzky, stated that Powell primarily made money through gambling, which he will not be able to do without internet access. Pissetzky also mentioned that the government has frozen Powell’s assets and that he intends to find a job once he is released.

There is currently no set date for Powell’s preliminary court hearing in Washington. Pissetzky declined to comment on the specifics of the case, stating that he looks forward to reviewing the extensive discovery with Powell now that he has been released.

Powell is one of three defendants charged in the indictment with conspiracy to commit wire fraud and aggravated identity theft. The other defendants, Carter Rohn and Emily Hernandez, have also been arrested and made initial appearances in their respective home districts.

The scheme used in this case is called SIM swapping, where attackers gain control of a telephone number by having it reassigned to a new device. This type of attack is becoming increasingly popular for targeting not only finances but also social media accounts to spread misinformation. It was also used in a recent high-profile attack on the U.S. Securities and Exchange Commission’s Twitter account.

According to the indictment, Powell, using the online aliases “R$” and “ElSwapo1,” worked with others to fraudulently obtain personal information from victims. They would then use fake identification cards to convince wireless service providers to transfer the victims’ phone numbers to new devices, allowing the defendants to bypass two-factor authentication and access victims’ virtual currency accounts, social media passwords, and other sensitive data. The indictment lists seven specific instances where the defendants were able to steal virtual currency from victims’ accounts.

The largest theft occurred in November 2022 when Powell directed his co-conspirators to execute a SIM swap against an FTX employee. Another co-conspirator sent Hernandez a fraudulent ID with the victim’s information and Hernandez’s photo. She then used this ID at a mobile phone store in Texas to convince them to transfer the victim’s information to a new device. Within a few hours, the defendants had drained over $400 million worth of virtual currency from the company’s accounts. On the same day, Powell targeted another victim, “A.C.” and stole nearly $600,000 in virtual currency.

The group also conducted similar attacks at cellphone stores across the country, including in Illinois, Indiana, Minnesota, Nebraska, New Mexico, Colorado, Virginia, and Florida. FTX announced that it had been hacked shortly after filing for bankruptcy and advised customers to avoid their website. A month later, Bankman-Fried was charged in New York for a separate scheme that defrauded customers and investors of at least $10 billion. He was convicted of fraud in November and faces a lengthy prison sentence.

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