Feds Accuse Man of Using Phony Accounts to Tap $3.5M of Cloud Services for Crypto Mining

On Monday, April 15, 2024, Brooklyn federal prosecutors announced the indictment and arrest of Charles O. Parks III, known as “CP3O,” for an alleged multi-million dollar cryptojacking scheme.

Parks is accused of illegally using over $3.5 million worth of cloud computing services from two major providers in order to secretly mine cryptocurrencies like Ether, Litecoin, and Monero for nearly a year. Cryptojacking, as prosecutors call it, involves taking someone else’s computer power without permission to generate digital money.

According to the indictment, between January 2021 and August 2021, Parks opened numerous accounts with phony names and emails linked to shell companies he operated. He then allegedly tricked the cloud services into giving him heightened access and deferred payments. This allowed Parks to secretly tap into vast amounts of their processing power and storage to privately mine cryptocurrency.

Prosecutors said Parks netted close to $1 million in cryptocurrency from the scheme. To allegedly cover his tracks, he laundered the funds through cryptocurrency exchanges, a non-fungible token marketplace, an online payment service, and traditional banks. NFTs are unique digital assets that use blockchain technology.

Parks is also accused of structuring some money movements to sidestep reporting requirements. He purportedly used the proceeds for luxury purchases such as a Mercedes Benz and jewelry in addition to five-star travel.

The 33-year-old Parks was arrested in Nebraska on April 13, 2024, and made his initial court appearance there on April 16. He faces federal charges of wire fraud, money laundering, and illegal monetary transactions, each carrying maximum prison terms of 20 years, 20 years, and 10 years respectively if convicted.

In announcing the indictment, US Attorney Breon Peace stated that while technology continues to evolve, his office remains committed to prosecuting those who exploit new methods for old crimes like theft and deception. An FBI official said criminals increasingly adopt innovative tactics, requiring determined investigations. A NYPD Commissioner credited cooperation between law enforcement and industry for identifying cybercriminals.