Nebraska Resident indicted in Brooklyn for multi-million dollar cryptojacking scheme

April 16, 2024 Robert Abruzzese, Courthouse Editor

The United States District Court for the Eastern District of New York in Brooklyn, where a Nebraska man faces charges for orchestrating a multimillion-dollar cryptojacking scheme. Brooklyn Eagle photo by Rob Abruzzese

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A Nebraska man has been indicted by federal prosecutors in the Eastern District of New York for allegedly masterminding a cryptojacking scheme that defrauded cloud computing service providers out of more than $3.5 million.

The indictment, which was unsealed on Monday, accuses the man of using stolen computing resources to mine nearly $1 million in cryptocurrency.

Identified as Charles O. Parks III, the 45-year-old man, also known by the alias “CP3O,” is facing charges of wire fraud, money laundering and engaging in unlawful monetary transactions. He was arrested on April 13 in Nebraska and is due to make his initial court appearance in Omaha on Tuesday.

The case is being prosecuted in Brooklyn because the alleged fraudulent activities had significant connections to the Eastern District of New York, involving interstate elements that qualify for federal jurisdiction. This district is noted for its handling of complex cybercrime cases, suggesting that the operations linked to the indictment spanned multiple states.

The United States attorney for the Eastern District of New York, along with FBI and NYPD officials, pointed out that such crimes not only exploit technological expertise but also cause considerable financial harm to businesses and can undermine the trust in digital economic activities.

“As alleged, by hijacking cloud providers’ computing power, Parks stole millions worth of powerful computing resources to acquire cryptocurrency,” said U.S. Attorney Breon Peace. “This office will continue to prioritize prosecuting criminal actors who use new, sophisticated technology to engage in the old scheme of fraud and deceit.”

If convicted on all charges, Parks could face a maximum of 20 years in prison for each of the wire fraud and money laundering charges and an additional 10 years for unlawful monetary transactions.