Ghaleb Alaumary aided North Korean hackers in the laundering of millions of dollars, including by exchanging cash for cryptocurrencies.
A Canadian-American person who used wire transfers and crypto exchanges to launder funds for North Korean military hackers was sentenced to 11 years in prison and ordered to pay $30 million in restitution by a US federal court.
A hack on Sony Pictures in retribution for the studio’s production of “The Interview,” a comical take on the isolated country, led to three North Korean military intelligence agents being charged with extortion schemes and cyberattacks totalling over $1.3 billion.
Ghaleb Alaumary, an Ontario resident, pleaded guilty in 2020 to conspiring to launder money for the North Korean government in 2018.
He encouraged others to launder unlawful funds acquired from BankIslami, in which the hackers evaded fraud prevention mechanisms to modify balances and boost withdrawal limits, as the point-person for the group’s ATM cash-out activities. The Pakistani commercial bank was robbed of $6.1 million.
The Democratic People’s Republic of Korea was not Alaumary’s only customer (DPRK). He also admitted to defrauding a Canadian university by sending emails purporting to be from a construction company demanding payment; the university handed him $9.4 million. Banks in Asia and a British soccer team are among the other victims.
“Once the ill-gotten funds were in accounts he controlled, Alaumary further laundered the funds through wire transfers, cash withdrawals, and by exchanging the funds for cryptocurrency.” according to a press release issued by the Department of Justice yesterday.
Acting U.S. Attorney David H. Estes of the Southern District of Georgia said,
“This defendant served as an integral conduit in a network of cybercriminals who siphoned tens of millions of dollars from multiple entities and institutions across the globe.”
“He managed a team of co-conspirators who helped line the pockets and digital wallets of thieves while laundering money for a rogue nation and some of the world’s worst cybercriminals.”
The North Korean defendants are still at large and presumably beyond of reach of the United States because the two nations do not have an extradition treaty, however the United States did successfully extradite a North Korean individual based in Malaysia in 2021, which was a first.
North Korea, a closed Communist state with nothing in the way of a functioning economy, has relied on military hacking to keep the lights turned on. In a May New Yorker story, Chainalysis’ Jesse Spiro estimated that DPRK hackers had stolen $1.75 billion in cryptocurrencies from exchanges, roughly a tenth of the country’s defense budget.