Scammer Lost $4.8 Million on Counterfeit Ledger Devices

A scammer lost $4.8 million by storing stolen funds on counterfeit Ledger devices. According to Chainalysis, he lost 60 bitcoins (about $4.8 million) due to three new devices with spyware recording seed phrases; all funds went to one wallet.

This is part of a broader incident: through counterfeit Ledgers in the supply chain, criminals stole over $103.4 million from 530 addresses. Ironically, the victim himself ran a fraudulent scheme where people were hired for fake sales and reviews of real products. Then the victims would find themselves with a "negative balance" and were asked to deposit their own money to receive payment. So, the victims of the scheme might not have been entirely honest themselves.

Ledger has suspended its reseller network in Southeast Asia, demanding the removal of devices from sale in Indonesia, Singapore, Thailand, the Philippines, Vietnam, Malaysia, and Hong Kong. The company insists that all confirmed thefts to date are from Asia. In Europe, reports of counterfeit Ledgers forced retailer MediaMarkt to suspend sales. Trezor decided to close part of its remote resellers starting January 1, as it cannot ensure the same control as with sellers closer to home; there are no reports of counterfeit Trezors.

Amid the scandal, Ledger introduced Atom – a $849 device combining a crypto wallet and Android applications, isolated from wallet operations. The company claims it blocks implants used in Asian thefts and detects tampering even when turned off.