The Scammer, The Fixer And The Cop: Inside L.a.'s World Of Millionaire 'crypto Kids'

Daniel landed successful Los Angeles pinch his woman and a difficult thrust containing $350,000 successful bitcoin.

The 17-year-old’s manner was intended to tie attention: Parties astatine nan hottest clubs. Rented sports cars. Cuban nexus chains. Imitation Richard Mille watches.

California is afloat of young group who were transformed into millionaires erstwhile crypto went mainstream. But Daniel didn’t conscionable bargain integer money erstwhile it was inexpensive and watch it skyrocket successful value. He stole it.

The teen — who was identified only by his first sanction erstwhile he testified arsenic a cooperating witnesser astatine a caller proceedings — was portion of thing called “the comm,” which national authorities opportunity was a loose web of con artists who treated defrauding investors of millions of dollars for illustration a game.

Holed up successful lavish rental homes successful Encino and Malibu, they hatched schemes to instrumentality group into giving up entree to crypto accounts pinch nine-figure balances. They gleefully screen-recorded immoderate of nan heists, prosecutors wrote successful tribunal documents charging them pinch racketeering, fraud and money laundering.

For Daniel, a rail-thin teen pinch a wispy goatee and heavy achromatic hair, nan nosy was not needfully spending nan stolen costs connected cars, cocaine, jewelry and his 23-year-old girlfriend, but flaunting his manner connected societal media.

It sewage him noticed by nan incorrect people.

Daniel was nan prima witnesser of a proceedings successful February and March that revealed a subculture revolving astir recently created crypto wealth. There are “crypto kids” — immoderate scammers for illustration Daniel, others who acquired their riches legitimately. There are fixers who group up them up pinch homes, cars, apparel and different luxuries.

And past location are those who preyed connected nan crypto kids. When masked, equipped men forced their measurement into Daniel’s flat successful 2024, they identified themselves arsenic constabulary officers.

One of them had worked for nan Los Angeles Police Department, but he wasn’t connected nan occupation erstwhile he came for Daniel.

According to 1 witness, nan erstwhile serviceman justified taking nan teenager’s crypto astatine gunpoint, calling it “stealing thing from personification who stole.”

‘Ghost’ and nan illicit crypto economy

On nan witnesser stand, Daniel didn’t opportunity wherever he grew up. He said English without nan trace of an accent and said he’s besides fluent successful Spanish and Portuguese. A detective testified nan teen showed him a passport that said he was calved successful Rio de Janeiro, but he acknowledged nan archive could person been fake.

Daniel said he met members of nan comm done nan encrypted messaging app Telegram. As he described it, they were not hackers. They stole fortunes done deceit, moving successful performance to impersonate labor from well-known crypto exchanges.

Daniel testified he called group pinch accounts connected Coinbase and different platforms, pretending to beryllium a customer work representative. After tricking investors into handing complete login access, he transferred bitcoin and different currencies into “hardware wallets” beyond nan scope of rule enforcement, Daniel said.

In 1 of nan astir brazen heists attributed to nan comm, Malone Lam, a 20-year-old Singaporean nationalist who was past surviving successful Los Angeles, allegedly stole $248 cardinal successful 2024.

Malone Lam has pleaded not blameworthy to racketeering, fraud and money laundering. Prosecutors allege nan Sinagaporean nationalist stole astir $250 cardinal from a bitcoin investor.

(U.S. District Court, District of Columbia)

While staying astatine a rented Encino mansion, prosecutors say, Lam plotted pinch respective accomplices to instrumentality an investor from Washington, D.C., into reasoning he was being hacked. After Lam’s accomplices purposely utilized incorrect credentials to entree nan man’s Google account, nan investor sewage a information alert, Jonathan Stratton, an adjunct U.S. attorney, said astatine Lam’s bail hearing.

Lam has pleaded not blameworthy to charges of racketeering, fraud and money laundering.

According to Stratton, Lam, posing arsenic a Google representative, called nan investor and convinced nan man to springiness up his password and information codes to forestall what Lam described arsenic a hacking attempt. Lam allegedly saw nan man had an relationship pinch Gemini, a crypto brokerage, and an accomplice posing arsenic a Gemini typical past called nan investor.

Convinced his Gemini relationship had been compromised, nan man agreed to download what he thought was a information program. In fact, it was a distant desktop exertion that enabled Lam and his conspirators to transportation 4,000 bitcoins to themselves, Stratton said. If Lam had tried to transportation disconnected that magnitude of money successful $100 bills, nan charismatic said, it would person weighed much than 2½ tons.

Afterward, Lam embarked connected “what only tin beryllium described arsenic an outrageous and exorbitant spending spree,” Stratton said. According to nan prosecutor, Lam spent $569,525 successful 1 nighttime astatine an unnamed L.A. nightclub, and he became “notorious” for throwing Hermes bags worthy tens of thousands of dollars into crowds of partygoers.

On Telegram, Lam was known arsenic $$$, King Greavys and Anne Hathaway.

Daniel was known arsenic Scare. Testifying successful a downtown L.A. courtroom, Daniel, dressed successful a charcoal suit, achromatic dress garment buttoned to nan pharynx and Louis Vuitton belt, said personification other had already claimed nan Scare grip connected Instagram, truthful he bought it from them for $16,000. He posted photographs that showed disconnected trappings of luxury without ever revealing his face.

One depicted a Louis Vuitton container pinch nan caption: “I’ve ne'er seen a cheater suffer truthful why would I play fair?”

When he arrived successful L.A. successful November 2024, Daniel had nary in installments history and couldn’t rent an flat successful his ain name. He said that done a nightlife promoter, he was introduced to Pierre Louis, a fixer who specialized successful getting rich | group what they wanted.

Louis, 27, testified he grew up successful Montreal. In a heavy Quebecois accent, he said he group up rappers, athletes and different able clients pinch rented cars, homes, jewelry and clothes. Although he catered to rich | group and hung retired successful posh nightclubs connected nan Westside, Louis said he made only astir $50,000 a twelvemonth and lived successful an flat successful Burbank.

When he first met Daniel, Louis testified nan teen tried to scam him by offering to thief pinch his crypto investments. That didn’t put disconnected Louis, who rented Daniel a high-rise flat connected Wilshire Boulevard. The teen sent him $60,000 successful bitcoin for six months’ rent.

Louis offered different service: a measurement to launder stolen crypto. Unable to usage morganatic exchanges, Daniel testified he converted immoderate by trading it for golden pinch a downtown L.A. jeweler. He besides relied connected Louis to link him pinch group consenting to salary rate for bitcoin without asking questions.

A teen testified he laundered stolen crypto done buying golden successful nan downtown L.A.’s Jewelry District.

(Myung J. Chun/Los Angeles Times)

Through communal friends successful nan luxury car rental business, Louis said, he had met a man called Ghost who had a web of crypto buyers. Louis testified that he sent Ghost costs he’d received from Daniel and different crypto kids, and Ghost brought him cash. Both Louis and Ghost charged their clients fees of 2% to 5%, nan complaint varying depending connected who was involved, Louis said.

After gathering Ghost, Louis said, he usually brought nan rate to a car rental business successful Van Nuys called Drive-LA to usage its electrical money counter. The company, which owned a fleet of Lamborghinis, Porsches and Bentleys, was tally by a erstwhile serviceman who aspired to beryllium much than conscionable a patrol cop.

Lamborghinis and ‘$5 wrench attacks’

Eric Halem created Drive-LA successful 2021 arsenic a broadside gig to his time occupation operating nan San Fernando Valley for nan LAPD.

The business, which besides offered customers entree to jets, homes and chauffeurs, gained a loyal pursuing among section rappers and societal media influencers. During an soul affairs interview, Halem said that he raked successful astir $1 cardinal a twelvemonth successful profit from Drive-LA, according to a section root who requested anonymity successful bid to talk unit matters. He claimed successful online interviews that he had interests from task capitalists and was looking to expand.

A 13-year seasoned of nan LAPD, Halem discontinue nan unit successful 2022 but was still moving arsenic a reserve serviceman erstwhile he met Louis, who testified he brokered hundreds of car leases for Drive-LA.

A erstwhile LAPD officer, Eric Halem, owned a car rental business called Drive-LA successful this business halfway successful Van Nuys.

(Myung J. Chun/Los Angeles Times)

Louis said he was astatine Drive-LA counting rate he’d received from Ghost erstwhile Halem asked wherever nan money came from.

“From nan crypto kids,” Louis replied.

Halem was funny really they were truthful rich. “I told him they fundamentally scam aliases bargain people’s crypto,” Louis recalled during his testimony.

Through Halem, Louis said, he was introduced to Gabby Ben. Twice convicted of fraud, Ben, 51, has ties to Israeli organized crime circles, a charismatic said astatine his bail proceeding successful November.

Louis brokered nan waste of Amiri apparel and Hermes bags from Lam to Ben, who bought nan luxuries connected in installments and ne'er paid him, Louis testified.

At Ben’s rented mansion successful nan Hollywood Hills, Louis said, he spitballed pinch Ben and Halem ideas connected really to rob crypto kids. Louis recalled Halem saying they were criminals who wouldn’t study being robbed to nan police.

“It’s fundamentally for illustration stealing thing from personification who stole,” Halem said, according to Louis.

It’s progressively communal for criminals to usage beingness unit to extract crypto from a victim, said Marilyne Ordekian, a teacher of information and crime subject astatine University College London who co-wrote a insubstantial connected nan trend.

The heists are called “$5 wrench attacks” aft a comic portion successful which a robber bypasses a laptop’s encryption protections by threatening nan personification pinch a wrench. A perpetrator who whitethorn deficiency nan method expertise to hack into a crypto wallet tin edifice to cruder methods, Ordekian said.

According to authorities, nan devices Halem, Ben and Louis planned to usage included constabulary uniforms, handcuffs and a gun.

Masked men, handcuffs and a setup

The crippled came together 2 days aft Christmas successful 2024, Louis testified.

Daniel had sent Louis $23,000 successful crypto to person to cash. Louis said nan scheme was for him to telephone Daniel down to nan parking car shed from his 18th-floor apartment, manus complete nan money and stall while nan others entered nan flat utilizing nan doorway codification that Louis had provided.

Louis, Halem, Ben and 3 others group retired from Ben’s location astir 2 a.m., driving to Koreatown successful a greenish Range River and orangish Lamborghini Urus, Louis testified. Both cars were owned by Drive-LA, Louis said.

Louis texted Daniel erstwhile he arrived. Ben had fixed Louis $7,000 successful rate for nan transaction. When Daniel sewage successful Louis’ Range Rover, he testified, he gave nan teen $6,000 — pocketing $1,000. Louis said he “dapped him up” and told him he’d spot him soon.

In Daniel’s telling, he was counting nan money successful Louis’ car erstwhile he sewage a matter from his woman that read, “Help me.”

His woman — identified successful tribunal only by her first name, Victoria — testified she was successful nan chamber unsocial erstwhile she heard nan sound of personification entering nan incorrect codification to nan beforehand door. She looked done nan pinhole and saw 2 men wearing hoods.

She testified that she fled to a closet and was hiding location erstwhile she heard nan sound of nan codification being entered again — this clip correctly. Through nan ace nether nan closet door, she said, she saw feet traipsing done nan chamber and heard men whispering successful a overseas language.

The feet approached nan closet door. Then it was thrown open.

“I’m greeted by 4 masked men,” Victoria testified. “One of them is holding a gun. I person my hands up. I’m saying, ‘I’ll springiness you what you want. I’ll springiness you nan safe. Just please don’t termination me.’”

The men said they were LAPD officers serving a hunt warrant.

“Exit nan closet,” 1 said.

They cuffed her wrists and demanded to cognize wherever her fellow was, she testified. Then she heard nan sound of Daniel opening nan beforehand door.

Daniel said he was “absolutely terrified” to spot men wearing achromatic clothes, constabulary vests and achromatic masks that covered everything but their eyes wrong his apartment.

“There was thing moving done my mind different than fear,” he recalled.

The men slammed him against a wall, snapped handcuffs onto his wrists and pushed him into nan spare chamber he utilized arsenic an office. The intruders told him to move connected his machine and transportation crypto retired of his wallet. Trying to instrumentality them, he showed them a wallet that contained only a small money.

Daniel testified 1 of nan men threatened to sprout him successful nan foot, asking different intruder for a gun. Daniel told them nan operation to a safe wherever he stored his hardware wallet, which was astir nan size of a USB drive.

Daniel testified he was being detained successful a bath pinch nan ablution moving erstwhile 1 of nan intruders burst successful and said thing successful a overseas language. The intruders fled nan apartment, leaving Daniel and his woman successful cuffs.

A forgotten codification and a missing fortune

Louis testified he was responsible for cutting nan robbery short. After Daniel near his car, he circled nan artifact a fewer times, past pulled over, he said.

“I started to consciousness blameworthy astir what was going on,” Louis testified. “He didn’t do thing to me.”

Louis had spent a fewer hours earlier that nighttime drinking astatine Poppy connected La Cienega Boulevard. He said he felt compelled to matter his accomplices wrong Daniel’s flat that nan constabulary were connected nan way.

“I deliberation it was nan intoxicant mixed pinch my feelings,” Louis said. He thought astir really Daniel, for illustration himself, was “just a personification trying to make it big.”

Later that night, Louis said, he and his bodyguard returned to Koreatown to cheque connected Daniel — and retrieve nan cuffs his accomplices had near behind.

Louis said he recovered Daniel and his woman hiding successful a safe room successful nan apartment. She was still handcuffed.

“We’re going to find who did this,” Louis recalled Daniel saying.

Louis testified he felt blameworthy astir mounting up Daniel, but he wasn’t supra pestering Halem and Ben for a trim of nan profits. Both tried putting him disconnected by claiming they hadn’t stolen anything, Louis testified.

Halem called nan full point a “major discarded of time,” Louis said. Yet Ben went connected a “nice small shopping spree” pinch his girlfriend, Louis testified, while Halem bought 2 Porsche 911 GTs and a Rolex Yacht Master watch.

When Louis confronted Ben astatine his house, Louis said, an subordinate he knew by nan nickname Lucky brandished a weapon and warned “not to messiness pinch them.” Louis testified that Ben said he was from nan “Israeli mafia” and knew group “everywhere.”

Ben has pleaded not blameworthy to charges of kidnapping, robbery and fraud. At a bail hearing, his lawyer said Ben owned morganatic healthcare and assisted surviving facilities.

Louis was arrested 5 months aft nan robbery. In a jailhouse call, Halem told him to “hang tight” and said he knew an FBI supplier who could get him retired of jail, according to Louis.

No 1 from nan FBI ever came to spot to him, Louis said, and Halem was arrested 3 months later.

Halem was convicted this period of robbery and kidnapping. He has maintained his innocence but faces a imaginable life sentence.

Louis was charged pinch robbing Daniel, and he agreed to attest against Halem successful hopes of getting retired of situation early. He has yet to beryllium sentenced.

The LAPD ne'er wished what happened to nan crypto connected Daniel’s difficult drive.

Daniel testified he mightiness person been capable to entree his wallet remotely utilizing a “seed phrase,” a unsocial drawstring of words that he wrote down connected a portion of paper. But nan men who robbed him took it from his safe, he said, and he can’t retrieve nan phrase.

Now 18, Daniel testified he doesn’t want nan crypto back, though he still tracks nan value of bitcoin connected his phone’s location screen.

“I spot it each day,” he said.