Published: Thu, March 14, 2019
Markets | By Otis Pena

Video shows four suspects of nationwide bitcoin scam

Video shows four suspects of nationwide bitcoin scam

Calgary police are looking to the public to help identify four men suspected in a $200,000 bitcoin fraud that included attacks in seven Canadian cities.

Police say they have received information that about 112 fraudulent transactions were made at bitcoin kiosks in cities including Calgary, Sherwood Park, Winnipeg, Toronto, Hamilton, Ottawa and Montreal between last September 16th and 26th. The attacks took place in 7 cities across Canada, half of them taking place in Calgary. These kind of attacks are possible due to the fact that it is possible to withdraw money from a Bitcoin kiosk and remotely canceling the transaction before the company can process the withdrawal.

Four suspects have been caught on surveillance footage, and are all described as adult men who likely have in-depth knowledge in cryptocurrency, bitcoin, and blockchain technology. The men are now on the run, and Calgary police are looking for them.

Todd is among the Bitcoin developers who developed a tool that allows processing transactions lost in the process, however, a tweaked version of the same is believed to be used for these scam transactions. While it was not created to facilitate theft, the tool lets "stuck" transactions to become released for the cost of an extra fee.

Bitcoin scheme suspect number four
Bitcoin scheme suspect number four

While bitcoin double-spending is not much heard of, it is not completely impossible. That creates two transactions in succession, one paying a specific amount to a specific address, and a second one double-spending that transaction.

Bitcoin ATMs have been growing in number across the world, with over 4,000 already in operation. In addition, you can optionally specify that the first transaction additional OP-RETURN, multisig, and "blacklisted" address outputs. That is why services ask for multiple confirmations for every transaction.

Suspect One: Toronto, Montreal, Ottawa and Hamilton.

The Calgary Police Service cybercrime team conducts and supports investigations into any crime that is found to have a connection to cyberspace, including fraud, drug trafficking, child exploitation and missing persons.

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