A superseding indictment unsealed Thursday in U.S. District Court has charged an additional 12 American and foreign nationals for their alleged involvement in a sophisticated racketeering scheme that siphoned over $263 million in cryptocurrency.
Several arrests were made this week in California, while two other suspects are believed to be residing in Dubai, according to a U.S. Department of Justice release. The defendants face a range of charges, including racketeering conspiracy, conspiracy to commit wire fraud, money laundering, and obstruction of justice.
This latest indictment expands upon charges initially filed in September 2024 against Malone Lam, following the alleged theft of over 4,100 BTC – valued at more than $230 million at the time – which was first brought to light by blockchain investigator ZachXBT. These funds were reportedly stolen from an early bitcoin investor and creditor of the now-defunct lending firm Genesis. ZachXBT, who collaborated with authorities and security firms Cryptoforensic Investigators and zeroShadow on what he described as “one of my best…of all time” financial forensic investigations, played a crucial role in tracing the illicit funds.
In a separate incident in July 2024, Lam and his alleged associates are accused of stealing over $14 million in cryptocurrency from another victim.
According to the indictment, the cybercriminal enterprise originated from online gaming friendships and evolved into a highly organized crypto theft operation, active from at least October 2023 to March 2025. Members of the ring adopted specialized roles, ranging from hacking databases and identifying high-value targets to impersonating support staff in phishing calls, laundering funds into U.S. dollars, and even physically breaking into homes to steal hardware wallets.
Prosecutors revealed that the stolen cryptocurrency fueled an extravagant lifestyle for the group, including nightclub tabs exceeding $500,000 per evening, luxury watches and clothing, private jet rentals, security guards, and a collection of exotic cars valued between $100,000 and $3.8 million. To obscure their financial tracks, the group allegedly employed mixers, “peel chains,” VPNs, and fake identities to launder funds across numerous platforms.
Remarkably, even after his September arrest and while in pretrial detention, Lam is accused of continuing to coordinate with enterprise members. He allegedly exchanged instructions, collected stolen crypto, and arranged for the purchase and hand-delivery of luxury Hermes Birkin bags to his girlfriend in Miami.
