A person identified with the initials J.G., an 18-year-old hacker from Wisconsin, who allegedly stole over $600,000 from DraftKings giant by hacking into the online accounts of more than 1,000 registered players, has pleaded guilty to the charges brought to him.

J.G. allegedly stole the login and password information of over 1,600 DraftKings members and used the information to hack into over 60,000 accounts on the online sports betting platform in November 2022. 

“Fraud Is Fun”

As per information from federal prosecutors in Manhattan, the teenager has been accused of sending the stolen login information to other individuals who then made use of it to withdraw over $600,000 from around 1,600 accounts. 

The procedure, which is referred to as credential stuffing, was openly admitted by the 18-year-old who attempted to take cash out of other players’ accounts in an illegal manner. He transparently texted one of his co-conspirators saying “Fraud is fun,” according to official court documents, adding that he was “addicted to seeing money” in his account.

When investigators searched his home in February 2023, they allegedly discovered a series of programs that the teenager had used in credential stuffing.

The young man had apparently used more than 700 individualized files to set up a website used to launch the cyber-attacks on his computer. The device contained around 40 million password and username combinations, according to law enforcement representatives. 

DraftKings Says It Reimbursed All the Stolen Money

The investigation also found that the hacker had stolen more than $2.1 million prior to his 18th birthday, making around $15,000 per day between 2018 and 2021 alone.

He pled guilty to a count of conspiring to commit computer intrusion. The charge features a five-year in-prison maximum sentence. The alleged hacker will be sentenced at a later date. 

His case is prosecuted by the Southern District of New York’s Frauds and Cybercrime Unit. 

The prosecution is represented by assistant US attorneys Kevin Mead and Micah Fergenson.

The company has confirmed the hacking event but did not provide any names in the suit. 

DraftKings also reimbursed all the stolen money from customers, using a statement issued by a spokesperson to explain the safety and security of the personal and financial information of their customers “is of paramount importance” to them.  

The hacker was also charged with alleged swatting, which is the process of practice of making a hoax call to the emergency services. It is believed that the teenager paid people with Bitcoin to make fake bomb-threat phone calls to his high school because he was “bored” and eager to go home, according to court documents. 

Earlier in the week, DraftKings unveiled its new Progressive Parlay feature that will target the fantasy gaming market in an attempt to push back against the growing popularity of competing fantasy sports operators.

The news follows the operator’s launch during Maine’s first weekend of regulated sports betting via a partnership with Passamaquoddy Tribe and the publishing of its Q3 results showcasing strong performance. 

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A businessman from Kent was accused of running illegal gambling operations in Florida. The man, who had allegedly operated an illegal slot machine business, has now pleaded not guilty to the charges.

The defendant, Timothy Surgen, is a 57-year-old man who, according to multiple charges, leveraged his company, Surgen Enterprises, to operate slot machines. His alleged violations have been outlined in over a hundred charges, claiming that he offered slots at the Black Beards Super Game Room, Games N More and Treasure Island Arcade properties.

For reference, Florida’s laws prohibit slot machines that pay out cash.

In addition to possessing slot machines and running illegal gambling operations, Surgen faces charges for money laundering.

Plaintiffs Allege Surgen Operated Illegal Gambling and Laundered Money

Surgen Enterprises was founded in Ohio in 2012. The company launched in Florida in 2018, where its owner filed it as a foreign limited liability company based of out Ohio.

In 2019, Surgen applied for a new business application, allowing him to establish Treasure Island Arcade, one of the venues where he offered illegal slots. The venue was officially listed as an arcade business offering 50 machines and overseen by three employees.

Games N More, one of the other venues in question, was launched in 2022 and was listed as a 20-machine arcade with four employees. Black Beards Super Game Room was founded that same year and was listed as an arcade with 25 machines and four employees. These two properties were notably founded by a former Surgen employee.

Between November 2022 and September 2023, investigators probed into Games N More and Treasure Island Arcade. Undercover agents spotted armed guards and learned that the venues offered multiple cash slots. To confirm that the machines were illegal, the agents tried to exchange cashout tickets for money and gift cards – a practice forbidden in Florida.

Surgen, who has now pleaded not guilty to running illegal gambling operations, is believed to have generated more than $304,000 of illegal money.

Surgen faces further charges.

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