The CEO of a South Korean crypto exchange has been indicted on charges of leaking classified information to North Korea. Earlier this month, authorities arrested the executive along with an army major, who authorities pinned weeks later, in the espionage operation.
North and South Korea have been embroiled in harsh relations since fighting a war in the early 1950s. Apart from recent frictions between other states and North Korea, the historical animosity between these two countries further exacerbates the alleged crime.
Top-Secret Information Exchanged for Bitcoin
South Korean authorities confirmed the arrests of the exchange’s CEO named only as Lee, and army chief Captain B on Thursday.
The two South Koreans, according to Seoul officials, supplied login credentials for South Korea’s joint military headquarters, allowing alien access. Both suspects are in punitive custody for violating the country’s National Security Act.
How It Began
According to local media, the North Korean operative met Lee at a crypto community six years ago. While little transpired between the two over the years, the exchange of secret information began last year July, chiefly via Telegram.
The spy reportedly approached Lee with the intention of recruiting an active-duty officer. Eventually, the businessman approached Captain B, who agreed to the crime only after promise of payment in Bitcoin. In addition, the executive director sent the captain a spy wristwatch. He also bought a ‘poison tap’ hacking gadget, which provided the agent with remote access to his laptop.
The duo traded login information for large quantities of money paid in cryptocurrency. According to authorities, the army officer received about $38,000 in BTC, while Lee banked more than $600,000 worth of BTC. Fortunately, both the military and police confirmed that the real hacking was unsuccessful since the computer network remained unpenetrated. Despite the failure of the breach, a report indicated that Captain B delivered confidential military recordings to North Korean hackers.
How It’s going
Curiously, the identity and location of the agent remain unknown. However, the confessions of the suspects indicate that the spy is a North Korean. North and South Korea have had a strained relationship for a long time. This national crime only serves to exacerbate the situation. According to reports, this is the first documented instance of online recruitment of an active-duty officer. For the time being, inquiries into an intermediary suspect between the crypto entrepreneur and the army officer are still proceeding.
North Korean Notoriety for Alleged Crypto Crimes
In addition to using hackers against other governments and global corporations, North Korea has been linked of late to repeated attacks on crypto outfits.
Three months after a report linked the country to a slew of successful hacks on centralized exchanges, authorities traced two more attacks to North Korean hacking outfit Lazarus Group. For one, earlier this month, security outfit Chainalysis linked Lazarus to the breach of Ronin Network, which resulted in a $600 million loss. According to another allegation, North Korean hackers stole about $400 million in cryptocurrency in at least seven crypto attacks last year.
There are suggestions that North Korea may be using a replete of hacking skills to sustain its stifling economy.