North Korea Targeting Crypto Industry With 'Complex and Elaborate' Social Engineering Campaigns: FBI

The Federal Bureau of Investigation (FBI) issued a warning about North Korea’s aggressive targeting of the crypto industry on Sept. 3.

The Federal Bureau of Investigation (FBI) has issued a warning regarding North Korea's aggressive targeting of the cryptocurrency industry, highlighting their use of sophisticated social engineering campaigns to steal crypto funds.

According to the FBI's report, North Korean actors have been conducting extensive pre-operational research, targeting employees of crypto-related businesses, particularly those involved in decentralized finance (DeFi) applications. These actors meticulously gather information on potential victims to enhance the effectiveness of their attacks.

The report also notes that North Korean actors have been showing interest in individuals connected to crypto exchange-traded funds (ETFs) in recent months. This observation suggests that future attacks may be directed at companies involved in crypto ETFs or other crypto-related financial products.

The FBI describes the tactics employed by North Korean actors as "complex and elaborate," emphasizing their skill in using social engineering to trick employees into deploying malware that steals crypto funds. The agency highlights the persistent threat posed by North Korea to organizations handling large quantities of cryptocurrency-related assets or products.

“For companies active in or associated with the cryptocurrency sector, the FBI emphasizes North Korea employs sophisticated tactics to steal cryptocurrency funds and is a persistent threat to organizations with access to large quantities of cryptocurrency-related assets or products.”

The report further adds that even cybersecurity-savvy individuals can fall victim to North Korea's relentless efforts to compromise networks connected to crypto.

A report by Recorded Future, conducted by the Insikt Group and published on Nov. 30, 2023, estimated that the North Korean hacking group Lazarus Group stole $3 billion in crypto from 2017 to 2023. This vast sum stolen by Lazarus Group demonstrates the effectiveness of North Korean actors' methods.

The FBI outlined several tactics used by North Korean actors, including extensive pre-operational research, individualized fake scenarios, and impersonations of legitimate entities or individuals.

Notably, the scouting performed by these actors before starting to execute the social engineering attacks targets not only a couple of employees but dozens of them.

The FBI explains that individualized fake scenarios often include offers of new employment or corporate investment, using personal information to build rapport with the potential victim.

Furthermore, the North Korean actors can also emulate “a range of individuals” to help them get the victims' trust, including recruiters and technology companies.

To mitigate risks, the FBI recommends developing unique identity verification methods, avoiding storage of crypto wallet information on internet-connected devices, and implementing multi-factor authentication for financial asset movements.

The agency urges victims of suspected North Korean cyber activities to disconnect affected devices immediately, file a complaint through the FBI Internet Crime Complaint Center, and provide detailed information to law enforcement.

Gino Matos

Gino Matos is a law school graduate and a seasoned journalist with six years of experience in the crypto industry. His expertise primarily focuses on the Brazilian blockchain ecosystem and developments in decentralized finance (DeFi).

Assad Jafri

AJ, a passionate journalist since Yemen's 2011 Arab Spring, has honed his skills worldwide for over a decade. Specializing in financial journalism, he now focuses on crypto reporting.

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