As police continue to investigate the kidnapping of the CEO of a company specializing in cryptocurrency this week, experts say such attacks are rare and can coincide with the price of crypto, which hit an all-time high in recent days.
On Wednesday, police say they responded to a kidnapping in downtown Toronto at rush hour.
CBC Toronto later learned the victim was Dean Skurka, the president and CEO of Toronto-based financial firm WonderFi. Skurka was later released after a ransom of $1 million was paid electronically, a source close to the investigation told CBC.
Ryan Duquette, the national lead of digital forensics at accounting firm MNP, says scammers are turning more and more to cryptocurrency for payment.
“They likely thought that he had access to lots of crypto, which is harder to trace and increasing in value,” Duquette said, noting that Bitcoin has had a recent increase in value.
The price of bitcoin hit a new high Wednesday, climbing above $75,000 US and breaking the previous record set in March.
WATCH | Toronto crypto company CEO kidnapped, held for $1M ransom before release:
Criminals may erroneously believe the head of a cryptocurrency company may have access to all his clients funds, Duquette said.
“It’s similar to someone kidnapping the CEO of one of the large four banks, thinking they have access to all the funds at the bank,” he said.
Skurka was found in an Etobicoke park Wednesday, police said, with the whole incident happening in the span of a few hours.
Skurka didn’t respond to requests for interview. However, he told CBC Toronto via email on Thursday that he had been involved in an “incident” Wednesday, and he was now safe and his clients had nothing to worry about.
“The safety and security of all of WonderFi’s employees are paramount,” Skurka said in the email. “Client funds and data remain safe, and were not impacted by this incident.”
Attacks still rare, but success rate is high: security officer
Attacks like the one this week are rare, says Jameson Lopp, the co-founder and chief security officer of Casa, a security firm focused on protecting cryptocurrency users.
Lopp told CBC Radio’s Here and Now Thursday that he monitors instances of suspects using physical violence to steal bitcoin, and Skurka’s the abduction was the 171st in English-speaking countries in the past in the past decade.
Dean Skurka is the President and CEO of WonderFi, a Toronto-based cryptocurrency firm. Experts say criminals may be enticed to target high-profile figures in the crypto world for attacks, seeing the crimes as low-risk, high-reward. (LinkedIn)
“It’s lower risk for them because the targets tend to not have good security and the pay-off tends to be really high, in the tens of millions of dollars-range,” Lopp said. “That’s why these individuals, and sometimes organized gangs, are going after well-known public figures in the space.”
Lopp says most of such attacks are successful, with only two or three of the 171 he’s recorded being defended against, though some criminals are caught after the fact.
“It usually comes down to how savvy the attacker is, how good they are at not giving away information during the attack, or laundering the funds after the attack,” he said.
More sophisticated criminals can send money to a “mixing service,” Lopp said, where crypto funds are pooled into one block chain and then redistributed, making it harder for investigators to trace.