Santa Clara County prosector wants to help victims

Erin West, a deputy district attorney in California, sits in her office inside the Santa Clara County District Attorney’s office in San Jose, Calif., on Monday, May 8, 2023. West has emerged as one of the country’s experts in successfully recouping money swindled by crypto criminals. (Shae Hammond/Bay Area News Group)

Thieves think that stolen cryptocurrency from duped consumers is the perfect crime – anonymous, secret and safe from seizure.

Erin West is proving them wrong.

In the past year, the Santa Clara County prosecutor and her team have recovered $2.5 million worth of digital currency from scammed Bay Area residents, with about 75 investigations still underway.

One victim was an entrepreneur whose cell phone account was hacked, then emptied. Another was a father who was tricked into a fake investment scheme, losing his child’s college fund. Yet another was a grandfather, fooled by the sobs of someone pretending to be his grandson in a car accident. There are hundreds of others.

Shining light on a complex world that thrives in darkness, West is crafting legal techniques to find and return once-vanished funds. With cryptocrimes on the rise, she has gained global acclaim, earning invitations to share her strategy at conferences in New York, Boston, Los Angeles and other U.S. cities, even the European Union’s law enforcement agency Europol.

“It’s not difficult, but it’s new,” said West, a deputy district attorney for the county who favors professorial glasses and a no-nonsense tone. “We can’t afford to not understand it.”

“We owe it to our victims to keep up with how the bad guys are moving their money,” she added. “People are really desperate, sometimes suicidal.”

Born in Sunnyvale, the daughter of an Intel vice president, West chose a career in law, not tech.

When civil litigation proved dispiriting, West turned to prosecuting sexual assault and domestic violence cases, attracted by the emotional reward of helping victims.

Eight years ago, she was offered a new challenge. Santa Clara County District Attorney Jeff Rosen appointed her to REACT (Rapid Enforcement Allied Computer Team), a multi-agency Bay Area task force that investigates high-tech crimes, led by his office.

With criminals hiding behind the seemingly bulletproof anonymity of blockchain transactions and anonymous wallets, it was essential to expand REACT’s expertise, Rosen said. “If we were in Los Angeles, we’d be experts at celebrity stalking cases or intellectual property theft of movies, scripts or music. If we were in New York, we’d be experts in banking crimes.

“Here in the heart of Silicon Valley, we’re the nation’s leading law enforcement agency when it comes to investigating and prosecuting high-tech crime in all of its forms,” he said.

While federal investigators are increasingly successful in cracking cryptocrimes of drug traffickers, money launderers, child pornographers, suspected terrorists and corporate ransomware attackers, they focus only on major heists.

For the average victim, there’s been no way to get help. Local police have lacked the time and training to investigate digital thefts.

“I thought this was an area where I could make a difference,” West recalled.  “We have a group of brainy detectives in a bullpen-type format that can bounce ideas off each other. We’re learning this technology together.”

Cryptocrime is so new that West and the REACT team had to teach themselves; there are no classes or specialized training. She subscribed to YouTube videos about cryptocurrency, listening while driving in her car or going for a walk. Whenever she’d hear a term that she didn’t understand — such as “token loan,” “mixer” or “API” — she’d write it down, then look it up.

“You just take little bites at a time,” she said. “I’m a big proponent — even in my personal life, like in the garden — of putting just 15 minutes a day into whatever I’m doing. Small consistent efforts can make a big difference.”

It’s a world dominated by men — “it’s very ‘dude heavy,’” she quips — but that’s a comfortable landscape for the mother of two teenage boys. “There’s a culture where people like to talk like they know everything,” she said. “I felt an obligation to actually understand what was going on.”

West’s initial cases involved “SIM swapping,” where criminals steal identities to empty digital bank accounts. This is how it works: Impersonators go to a cell phone carrier such as AT&T and persuade the carrier to assign your phone numbers to them. Then, with access to calls, texts and other verification tools to change your passwords, criminals withdraw funds.

She’s gone after phishing frauds, when an email or text gets you to pay a different person than you meant to pay. She’s also recovered funds if you’re tricked into depositing money in a bitcoin ATM.

Last year, her team began investigating a new scam, called “pig butchering,” which combines a fake friendship with an investment spin. A con artist uses text or social media to engage you, then encourages you to invest in fake crypto.

For local detectives, an investigation can feel daunting. For instance, they can’t go overseas with an arrest warrant to find hidden and well-organized criminal gangs.

But West knew that blockchain, a storage technology used for saving data on decentralized networks, leaves a money trail, perfectly preserving evidence. Every transaction has a unique identifying number. Software tracing tools can identify the cryptocurrency exchange, which acts like a bank, where the money is held. Exchanges have ledgers and know who holds a blockchain “wallet” address, the series of letters and numbers used to anonymously send and receive funds.

Working with the exchanges and blockchain analytics companies, West and the REACT team can map the flow of transactions between criminals and a duped Bay Area resident. The team finds the stolen money at an exchange, then asks the exchange to move the funds into a government-controlled wallet. Then they ask a judge to authorize them to give the stolen funds back to the victim.

“The exchanges will respond to a Santa Clara County search warrant. They want to get ‘dirty money’ off their platform,” she said. “If we provide them with the correct legal paperwork, they will return the money.”

To explain, she likens it to a stolen bicycle.

Imagine that you live in Santa Clara County and your bike is stolen.  Detectives find the bicycle in a storage locker in the U.K. They serve a warrant to the storage company, which doesn’t want stolen bikes on its property. The storage company gives notice to the person who rents the locker, and the bike is returned to Santa Clara County.

The challenge is that there’s no easy mechanism in California law for how a victim can get the bicycle back without filing a criminal case against the person who rented the locker.

West’s strategy: “We send a letter to the person who rents the locker and say ‘Hey, you may look in your locker and see that that the bicycle is gone, because we have it we have it.  We want to give it back to this person who says it’s their bicycle. But if they’re wrong, and it’s actually your bicycle, then let’s talk about it in court.’ ”

“It’s really as simple as that,” she said.

So far, the team has been able to return money to 25% of victims. The odds of recovery improve if a victim reports the crime quickly, with specific details, she said.

U.S. Secret Service agent Shawn Bradstreet calls West “a pioneer in the recoupment of stolen funds to the victims of cryptocurrency fraud. Her passion for helping victims knows no bounds, and we are fortunate to have her as a partner in the mission to combat cyber-enabled financial fraud.”

West has reached out to assist police departments far from Silicon Valley. “She’s a mentor and a resource,  and was instrumental in helping me solve two cases,” said Sgt. Jake Tuzinski of Brooklyn Park, Minnesota, a suburban city north of Minneapolis.