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Former Ubiquiti Employee Gets 6 Years in Jail for $2 Million Crypto Extortion Case

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May 15, 2023Ravie LakshmananCyber Crime / Network Security

Crypto Extortion Case

A former employee of Ubiquiti has been sentenced to six years in jail after he pleaded guilty to posing as an anonymous hacker and a whistleblower in an attempt to extort almost $2 million worth of cryptocurrency while working at the company.

Nickolas Sharp, 37, was arrested in December 2021 for using his insider access as a senior developer to steal confidential data and sending an anonymous email asking the network technology provider to pay 50 bitcoin (about $2 million at the time) in exchange for the siphoned information.

Ubiquiti, however, didn’t yield to the ransom attempt and instead looped in law enforcement, which eventually identified Sharp as the hacker after tracing a VPN connection to a Surfshark account purchased with his PayPal account.

Cybersecurity

“Sharp repeatedly misused his administrative access to download gigabytes of confidential data from his employer,” the U.S. Justice Department said, adding he “modified session file names to attempt to make it appear as if other coworkers were responsible for his malicious sessions.”

The Oregon-based defendant, besides giving false statements denying any knowledge of the extortion scheme, tampered with log retention policies and other session file names in order to conceal his unauthorized activity on the company’s network.

Sharp, who was employed at Ubiquiti from August 2018 through late March 2021, pleaded guilty earlier this February to falsely spreading the news that the company had been hacked by an unidentified perpetrator who had acquired administrator access to the firm’s AWS accounts.

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The fabricated security breach led to Ubiquiti’s stock price sliding approximately 20% in March 2021, causing it to lose over $4 billion in market capitalization.

In addition to the prison term, Sharp has been “sentenced to three years of supervised release and ordered to pay restitution of $1,590,487 and to forfeit personal property used or intended to be used in connection with these offenses.”

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