German Police Detain 'Bitcoin Mining Hackers'

German police have detained two people suspected of hacking into computer networks and using them to mine over €700,000 worth of bitcoins. Three suspects face organised computer fraud and commercial fraud charges, according to the public prosecutor’s office in Kempten.

Two of the suspects were arrested Monday night in a raid by GSG-9, the German federal counter-terrorism unit. The raids were carried out in Bavaria and Lower Saxony, According to the Federal Criminal Police Office of Germany (BKA)

There was no arrest warrant against the third suspect, and it is somewhat unclear why federal authorities decided to employ a counter-terrorism unit to take down a handful of counterfeiters.

The group managed to create a bitcoin mining 'botnet' by modifying existing malware and letting it loose on the internet. The custom malware compromised several computer systems and gave them access to a powerful botnet. The malware also allowed the attackers to collect personal data from affected networks and computers.

BKA President Jorg Ziercke said the internet provides organised criminal groups with a new modus operandi that poses a great financial risk.

“In this case the perpetrators managed to generate virtual currency bitcoin through compromised computer systems. Digital currencies, like bitcoin, will be tracked by law enforcement agencies in the future. The relative anonymity of these currencies facilitates money laundering and minimizes risk of detection.”

The BKA estimates that the group illegally mined at least €700,000 worth of bitcoins. An extensive cache of evidence was seized in the raids. It also pointed to other criminal activities, including copyright violations and distribution of pornographic content.

Due to the ongoing nature of the investigation, the authorities could not release further press information.

Police image via Shutterstock