Australian Federal Police Seize $6.4 Million from Ghost Mastermind

The Australian Federal Police (AFP) have seized 9.3 million Australian dollars ($6.4 million) from the alleged mastermind behind Ghost, an encrypted messaging service utilized by organized crime groups for coordinating illegal activities, including drug trafficking and money laundering.

Ghost provided advanced encryption features and self-destructing messages, and was dismantled last month following a two-year investigation led by Europol and various global law enforcement agencies, including the AFP.

A 32-year-old man from Narwee, a suburb of Sydney in New South Wales, was arrested on September 17 as part of the AFP’s ongoing Operation Kraken. He has been charged with five offenses, including supporting a criminal organization. Notably, this operation is unrelated to the well-known crypto exchange Kraken.

The AFP reported that the crypto assets were seized after their analytics specialists, part of the AFP-led Criminal Assets Confiscation Taskforce (CACT), deciphered the suspect’s seed phrases from hardware wallet devices found at his residence. Access to the cryptocurrency was thus gained and transferred to secure storage. This marks the second seizure of cryptocurrencies under Operation Kraken, following an earlier restraint of 2 million AUD ($1.4 million) linked to a Western Australian crime syndicate in August.

Crypto hardware wallets are generally considered secure as they store private keys offline, reducing vulnerability to hacks or malware. However, if an individual gains physical access, they could potentially extract or decipher the seed phrases needed to access the wallet and recover funds.

“The restraint of these assets shows the technical capabilities and powers that the AFP, and our partners through the CACT, are able to bring to bear on organized crime,” stated AFP acting Commander Scott Raven. “Whether you have tried to hide them in real estate, cryptocurrency or cash, we will identify your ill-gotten goods and take them away from you, leaving you with nothing.”

Operation Kraken Overview

The AFP’s Operation Kraken against organized crime has thus far led to 46 arrests, 93 search warrants, and intervention in 50 threats to life or harm. Since its inception in 2022, Operation Kraken has seized 2.37 million AUD ($1.6 million) in cash and 11.09 million AUD ($7.6 million) in various other assets.

The CACT, which includes entities such as the AFP, Australian Taxation Office, Australian Criminal Intelligence Commission, AUSTRAC, and Australian Border Force, plans to seek forfeiture of the restrained assets to the Commonwealth, which will be managed by the Australian Financial Security Authority to support the country’s crime prevention programs.