Apple iCloud account attack results in man losing $650,000 from his cryptocurrency wallet

Cryptocurrency wallet maker MetaMask has warned its 21 million monthly users to be wary of Apple iCloud backing up their app's data by default, after attackers successfully stole $650,000 of funds and NFTs.

MetaMask user Domenic Iacovone revealed in a series of posts on Twitter that he had fallen victim to a social engineering attack that gave scammers access to his iCloud account.

The problems started on April 15, according to Iacovone, when he received multiple messages asking him to reset his Apple ID password, followed by a phone call from "Apple Inc."

The scammer on the phone, who had spoofed caller ID to pretend to be Apple, told Iacovone that there had been suspicious activity on his Apple iCloud account.  All Iacovone had to do to resolve the issue, he was told, was confirm that he was the genuine user of the account by sharing a one-time verification code that his phone was about to receive.

Iacovone, who says he was lulled into a false sense of security because the caller had an American accent, duly handed over the six-digit code.  The scammer duly promptly hung up the call and emptied $650,000 worth of funds and NFTs from his MetaMask cryptocurrency wallet.

Gaining access to someone's Apple iCloud account is not particularly difficult, if the target can be tricked into providing a verification code sent by Apple when someone (in this case the scammers) is struggling to log into an account.

For this reason, you should never give a verification code to someone who asks for it, even if they claim to work for Apple.

So, a criminal had successfully broken into the Apple iCloud account, but how had that resulted in Iacovone's cryptocurrency wallet being emptied?

As a security expert going by the name of Serpent explained on Twitter, by default data from MetaMask is automatically backed up to Apple iCloud - data which includes the secret 12-word recovery phrase.

Many MetaMask users may have been reassured that MetaMask stores a user's Secret Recovery Phrase, passwords, and private keys in an encrypted format locally on the device where the MetaMask is installed - but be unaware that by default it is backed up to Apple iCloud.

MetaMask's FAQ tells users never to give their secret recovery phrase or private keys to anyone, as they could seize full control over your funds, but it doesn't presently warn that - unless you take preventative steps - they will also be stored in iCloud.

So if someone is able to gain access to your Apple iCloud account, and force their way into your encrypted MetaMask vault (maybe because you reused a password, or just chose an obvious one, or one that could be cracked) then they access everything in your crypto wallet.

In the wake of the attack against Iacovone, MetaMask has advised users to change their iPhone settings if they wish to disable iCloud backups for MetaMask.

You can verify what apps on your iOS device are having their data backed up to iCloud via
Settings > Profile > iCloud > Manage Storage > Backups.

Making such a change seems like a very good idea to me.

In all likelihood, Iacovone was specifically targeted by the attackers because they were aware that he had substantial crypto assets.  But there are lessons that all users can learn from this incident:

• Never give anyone a verification code sent to you by Apple, Instagram, or any other service - they might be trying to break into your account.
• Remember Caller ID can be spoofed by scammers, to disguise themselves as other people or companies.
• Check your phone settings to ensure that only the data you want to backup to Apple iCloud is being backed up.
• Stop showing off on social media about your cryptocurrency investments - you might attract unwanted attention.
• Consider using a cold hardware wallet for your cryptocurrency, rather than a software one.