Hello a few days ago I was a victim of a very elaborate scam on LBC. I wanted to post it here so that someone else would not make the same mistakes as me. As a side note if anyone has any idea how to identify which exchanges hot wallet the funds were sent to it would be a big help for law enforcement and I could provide an award if info leads to his arrest.
I am a trader on the cryptocurrency exchange website Localbitcoins.com People contact me to buy Bitcoins for cash. On March 1st I was contacted by a man claiming to be Daniel Polotsky. Daniel is the CEO of Coinflip a business which runs Cryptocurrency ATMS around the country and local to Chicago. I looked up his facebook and saw on the Coinflip website that he was indeed the CEO of the company. He informed me that he needed to purchase Bitcoin and I agreed like a normal transaction. I use the text messaging app Signal, and under the app his number was identified as Coin Flip Danny.
I had recognized Coin flip from the localbitcoins website as another seller. It was not out of the ordinary to be contacted by other large sellers in the Local Chicago market. He mentioned that he was in Rockford and I could come and meet him for an exchange or I could do a transaction at one of his local ATMs with a custom order. I was a little suspicious but did my research regarding any possible scams like this and found none. He mentioned something along the lines of the company running short on Bitcoin supply and he needed to pay at a very high intrest rate unless he got Bitcoins fast. The store with the ATM was closed at that point so I told him I would do it tomorrow.
The next day I arrived at 1213 W Diversey Pkwy VapeCity Chicago, Chicago, IL 60614. I was in contact with him over text coordinating my arrival. When I got there I noticed that the ATM was a buy only one. He mentioned that this was okay and he could still have it dispense cash. I went through the process still vigilant for any scams. At this point he called me and talked me through the rest of the process. He had me set up an account with the ATM. This required registering a phone number, He was very particular to make sure it was the same phone number we were conversing with so there would be no mistakes. I scanned my ID for verification. And informed him I had finished. He was at his computer and he said that my registration was not showing up in the system. I said are you sure and he said yes. Then I checked my texts and saw I had received a text from a Coin Flip operator saying my ID could not be verified because it was blurry. He said that was okay and to redo it. As we were doing this he expressed great knowledge of the regulations behind operating a Money Service Business, something that further sold him being Daniel, and indicates to me that he has likely sold Bitcoins in the past. He also went out of his way to talk about the Coinflip company again providing some indicators of insider info and saying that he was surprised that I hadn't heard too much about them, I said I had but I just hadn't used your machines before. At this point because of his knowledge of the system and interaction with Coinflip files I was sold that he was in fact who he claimed to be. I finished my upload of documents and got a conformation. Without me telling him, he told me that he now saw that I was then confirmed in the system.
From this point he sent me a Bitcoin address. I could not use escrow because his system had to receive the transaction first before it could dispense cash. Because the ATM was a buy only ATM I did not think this was out of the ordinary, and that he was going to set a custom offer which he seemed ready to do. I sent .726 bitcoin to the address. Originally he had told me he could bypass the confirmation time of the transaction and get me the cash as soon as it was ready. However, when the transaction appeared on the blockchain he then said he was having difficulty and wouldn't be able to send the money without 3 conformations. Something that takes 45-1:15 minutes. At this point I was running late for work, which he knew. He said that my code would be good for 24 hours and that I could just come back later. I told him I would be back at 7pm.
I returned to the store at 7pm. He said he wished I gave him more of a heads up and it would be 10 minutes. After 30 minutes I asked him what was up he said 4 minutes. 15 minutes after that I asked him what was up and he told me to calm down, he was grabbing dinner and he was with his kid. (I did not escalate at all, I was just asking). He then said 1 minute while he gets in front of a computer. 10 minutes later I informed him the store would be closing soon. About 5 minutes after that he said he processed it and it was good to go. I asked him how I was supposed to redeem it and received no reply. He would not answer phone calls, and has not replied since. It is unclear to me why hours after the Bitcoin was sent he would continue to string me along. The money was in his possession and he could have cut contact before that and gotten away just as easily.
The next day I informed him I would be filing a police report if I did not get the cash that night. I called a few times and went right to voicemail. That night I went to another 2 way machine to double check that I couldn't withdraw from an actual 2 way account. Following that I called Coinflip where an operator put me on hold and called Daniel Polotsky. Daniel denied ever texting anyone and the operator said that I had been scammed by a highly intricate scheme the likes of which they had never heard of before.
They explained that they thought it was 'a great coincidence' and that the perpetrator just guessed the verification error. Although it is possible, I find this very suspicious I went to the Chicago Police Department and filed a report, but they didn't seem to know if there was a cyber crime division so I don't know how useful that will be. The officer called the cell phone, the first time it rang twice before being sent to voicemail, after that it went straight to voicemail indicating the phone had been on.
The bitcoin can be traced into what I belive is an exchange's hot wallet, although I do not know how to identify which exchange this is. I know that it is possible for law enforcement to do this and that it has been used many times to knab similar perpetrators. If he sent this to an account with personal information it would be easy to identify the individual.
ORIGINAL TRANSACTION:
0.726 Sent to 1JHA4DpDKWFkvoM5yP5an31iZu891hcnEy
txid 469cff358b316dcb8e545b8b6e1f0d54a4b990bd70dfa4c88c83beb425ba1c36
https://www.blockchain.com/btc/address/1JHA4DpDKWFkvoM5yP5an31iZu891hcnEyINTERMEDIARY TRANSACTION
3EPnD8BPymMjw5xp6qBy5zeTBFeZGX82Zi
Hash 160 8b571da9540ce602fe0f2f84a200400175f6a429
No. Transactions 2
Total Received 0.72614437 BTC
Final Balance 0 BTC
https://www.blockchain.com/btc/address/3EPnD8BPymMjw5xp6qBy5zeTBFeZGX82ZiEXCHANGE TRANSACTION
14TDxS9NQhiu1tX4qeFwRkisXn1oDmTuKB
Hash 160 25de01dcaf6d82a584080136d47a9530972d0fb8
Transactions
No. Transactions 1186
Total Received 3,430.52833018 BTC
Final Balance 144.11436599 BTC
https://www.blockchain.com/btc/address/14TDxS9NQhiu1tX4qeFwRkisXn1oDmTuKBAs you can see this is a very large wallet and likely a major exchange.
The number that contacted me was 201-745-4848. Unfortunately the majority of the texts were encrypted and deleted automatically on Signal.
Anyways guys learn from me and be careful. I'm really kicking myself for this one.
