Australian feds cracked ‘seed phrase’ to access crypto account linked to global organized crime

The Australian Federal Police’s Criminal Asset Seizure Task Force has cracked a “seed phrase” linked to an account belonging to the alleged creator of the encrypted messaging app “Ghost”, which authorities allege is being used for organized crime.

Following analysis of digital devices seized from the home of a New South Wales man suspected of being the creator of “Ghost,” the Australian task force was able to withdraw $6.4 million from the suspect’s crypto account, according to an AFP press release.

Ghost is an encrypted communications platform that authorities allege is being used for organized crime.

AFP said the Ghost creator had restricted crypto funds in his account under the Commonwealth Proceeds of Crime Act 2002 and would use the money to fund law enforcement initiatives.

Once seized, the funds are placed in the Seized Assets Account, which is managed by the Australian Financial Security Authority on behalf of the Commonwealth.

AFP Acting Commander Scott Raven said in a statement that the discovery of US$6.4 million from the alleged Ghost producer’s account proves that AFP and CACT have the technical capabilities to confront organized crime groups seeking to hide their illicit profits.

“Whether you tried to hide them in real estate, cryptocurrency, or cash, we will identify and take away your illegally acquired goods, leaving you with nothing,” Raven said.

The discovery is the latest development in the AFP’s investigation into organized crime linked to a syndicate otherwise known as Operation Kraken, involving the alleged Ghost app maker and its users.

This is the second seizure of assets by Australian authorities against the app Ghost, following the seizure of $1.4 million worth of cryptocurrency and properties in August.

So far Operation Kraken has resulted in the seizure of assets worth AUD11.09 million or US$8.2 million, the arrest of 46 people, the response to 50 threats to life or harm and the blocking of more than 200kg of illicit drugs from entering Australia.

The 32-year-old suspect is alleged to be the brains behind the organized crime group established around the Ghost application. He was arrested on September 17 and charged with five crimes, including supporting a criminal organisation.