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More than a $1 million drained from San Diego man’s crypto account

SAN DIEGO (KGTV) – A local business owner woke up to a nightmare scenario, more than $1 million dollars drained of his savings from his crypto account.

When Anwar Husain accessed his crypto savings account last Tuesday morning, he did a double take.

“I honestly felt numb. I don’t even know how that was possible. I still can’t process all the emotions,” said Husain.

More than a year ago, Husain and his brother poured their savings into an account with the crypto exchange platform Coinbase, an account that suddenly lost much of its value.

“That’s when I noticed that $1.2 million dollars was missing,” Husain said.

The disappearance was a confusing one, highlighted by a bewildering amount of trades.

“It was 11,000 transactions that happened in a 5-hour period,” Husain said.

Such high-volume transactions have been hallmarks of crypto-hacks in recent years.

Husain says that in the transactions, his high value coins were traded for lower value coins.

Once converted into these lesser coins, experts say hackers can flood the market, dump the coins and manipulate prices for profit, or they can sell the undervalued coins to themselves.

“They could have just taken all the coins in my portfolio at a loss or at a discount,” Husain said.

However it was done, the money seems to be gone. Husain and his brother, who co-founded Smashtech, a hub-based marketing firm for health and wellness brands, are using the funds to support the business.

“We thought it was safe… really took me for a whirlwind. It was just an absolute kick in the gut,” said Husain.

He says Coinbase told him they are looking into it, while the FBI has also reached out to him in the past week.

“Just trying to maintain some composure through this, and the belief that a solution will come out of it in the end,” Husain said. “I also want others to know it can happen to anyone.”

The FBI says it cannot comment on active investigations.

In a statement, Coinbase says the user’s API key has been compromised, allowing third-party apps and services to access accounts to streamline trading.

“Coinbase takes extensive security measures to ensure that our customer accounts remain as secure as possible. In addition to educating our customers on best practices for securing their Coinbase accounts, Coinbase has a dedicated fraud investigation team and policy to provide specialized support for our customers We also offer global phone support for all customers, and live messaging.

The user has compromised Application Programming Interface (API) keys. We contacted the account holder and sent the case to a specialist to review the account for reimbursement under the Coinbase One Account Protection program.

You can learn more about Coinbase One Account Protection Program here: https://help.coinbase.com/en/coinbase/other-topics/coinbase-one/account-protection [help.coinbase.com]

We recognize that these are heinous crimes that can have a significant impact on consumers. With more and more of our personal information available online, it is increasingly important for consumers to understand how to protect their personal information from unauthorized third parties.

We encourage all our customers to take important steps to secure their online accounts. You can see an overview below and the full details in our Help Center. [help.coinbase.com]

  • Make sure all financial accounts and email have 2FA (two-factor authentication) enabled, preferably using a TOTP code generator (Time Based One-Time Wagcode) or hardware 2FA key (such as a Yubikey).
  • Use a strong, unique password for each of your online accounts. Use a password manager like LastPass, 1Password or Dashlane to easily generate and securely store unique passwords for all your online accounts.
  • Do not store API key data in a public space or forum.
  • Make sure your cellular service provider has enabled additional security features for your cellular account, such as your personal account PIN.
  • Do not share personal banking information with any unknown third party

We recommend that our users take the same protective steps for all their accounts.

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