Treasury reports that tools used to exploit U.S. software were financed with millions in cryptocurrency, according to new sanctions.

An Australian citizen has been reported to have sold cyber tools intended for the U.S. government and its allies to a Russian entity identified as Operation Zero.

The U.S. Department of the Treasury has imposed sanctions on a company involved in acquiring stolen U.S. technology utilizing digital currencies. (Jesse Hamilton/CoinDesk)

Key points:

• The U.S. Department of the Treasury has enforced sanctions against a Russian firm and the individuals linked to it for trading in pilfered technology bought with substantial amounts of cryptocurrency.
• The technology was developed by a defense contractor for the U.S. government, and it is reported that one of the contractor’s staff members stole it and sold it to Operation Zero, which is the focus of the new sanctions.

The U.S. Treasury Department has sanctioned the Russian organization Operation Zero and the individuals associated with it, alleging that they purchased stolen cyber tools for millions in cryptocurrency and subsequently resold these technologies, which were designed for U.S. government use.

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The tools that were bought and sold by the recently sanctioned Sergey Sergeyevich Zelenyuk and his enterprise, Operation Zero, were reportedly stolen by an Australian individual, Peter Williams, who previously worked at the defense contractor that developed the national-security oriented software “for the exclusive use of the U.S. government and select allies.” Williams admitted guilt last year for selling trade secrets.

“Treasury will continue to collaborate with the rest of the Trump Administration to safeguard sensitive American intellectual property and protect our national security,” stated Secretary of the Treasury Scott Bessent in a release.

Zelenyuk and the others involved are noted as the first individuals to be sanctioned under the Protecting American Intellectual Property Act. The sanctions issued by the Office of Foreign Assets Control prohibit U.S. entities from engaging in any business transactions with those identified or with others who associate with them. “Operation Zero has attempted to recruit hackers to aid its operations and forge business connections with foreign intelligence services through social media,” said the Treasury Department in its announcement. The allegations indicate that the tools were offered to those looking to exploit weaknesses in computer software.

While the Treasury’s Office of Foreign Assets Control claimed that cryptocurrencies were utilized in the transactions, it did not specify particular addresses for blacklisting.

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