Crypto Kidnapping to Crypto ATM Scams
People are often drawn to Cryptocurrency for the belief of fast profits and financial freedom which has made the decentralised finance (DeFi) sector one of the most talked about innovations in recent decades.
But as digital assets become more mainstream, so too do the scammers lurking in the shadows that follow them. Two recent, unrelated cases one involving a shocking alleged kidnapping in New York City and the other, a multi jurisdictional investigation into crypto ATM scams in Australia. Show just how far criminals will go to exploit the new frontier of finance.
Allegations: A Million Dollar Wallet and a 17 Day Nightmare
Late last month a barefoot and bloodied man emerged from a New York City townhouse in the affluent neighbourhood of Northern Little Italy. What he told the traffic officer who found him sparked a criminal case that has shocked the crypto world and beyond.
The man, a 28 year old Italian national alleged he was kidnapped and tortured for over two weeks by two longtime acquaintances William Duplessie and John Woeltz both self described crypto investors. According to prosecutors, the accused attempted to extract the victim’s million dollar cryptocurrency holdings through beatings, electrocution and even setting him on fire using tequila as an accelerant.
The details are pretty grim and involved pistol whipping, forced crack use and alleged threats to the victim’s family. Photos obtained from the crime scene reportedly show the accused pointing a gun at the victim’s head and dangling him from a staircase five stories high. The man says he only managed to escape after being allowed access to his computer to retrieve a password, seizing the opportunity to flee.
Yet, in a really odd move the defence has painted a radically different picture. Lawyers for the accused claim the Italian man was a willing participant in drug fuelled parties and orgies, even venturing out to eyeglass stores, churches and dinners during the alleged captivity. They argue video evidence shows him smiling and socializing hardly the behaviour of a kidnap victim.
Both Duplessie and Woeltz are well known in niche crypto circles. Duplessie was reportedly the CEO of a Swiss based blockchain firm that catered to distressed crypto companies. Woeltz, once dubbed “the crypto king of Kentucky,” sat on the board of a not-for-profit promoting entrepreneurship.
Crypto ATMs: Easy Access, Easier Scams
While the New York case is extreme, it’s far from the only example of crypto’s vulnerability to criminal exploitation. In Australia, police have launched a nationwide crackdown on cryptocurrency ATM users after uncovering widespread scams particularly targeting older Australians.
In one of the most disturbing cases a 77 year old widow named Olivia (not her real name) was duped into sending AUD433,000 to a scammer she believed to be a Belgian boyfriend met on a dating app. Over two years, she became "expert" at using crypto ATMs converting cash withdrawals into Bitcoin and sending them to addresses controlled by scammers.
Her story is heartbreakingly common. According to AUSTRAC, Australians lost over AUD 3 million to scams involving crypto ATMs in just 12 months. Of the 150 reported incidents most involved investment, romance or extortion scams. Most victims were women over 51 lured by false promises of love or financial gain.
Authorities say these machines once promoted as a convenient on ramp for crypto investors are now being used by organized crime syndicates to launder stolen money. In response, AUSTRAC has imposed an AUD 5,000 cap on crypto ATM deposits and withdrawals, while educational signs warning of scams are being placed on machines across the country.
Remember Everyone, Please be safe out there
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