Former Canadian government employee pleads guilty to US ransomware charges

A former Canadian federal official from Gatineau, Quebec, who pleaded guilty in Canada after a ransomware investigation that yielded tens of millions of dollars worth of bitcoins seized, has now pleaded guilty to similar charges in the United States.

Sébastien Vachon-Desjardins was arrested by the RCMP in January last year on allegations that he was a key figure in an international ransomware ring known as NetWalker.

NetWalker allegedly targeted businesses and other institutions by encrypting data on their systems and then holding that data for ransom. It is also alleged that he accessed and stole sensitive personal information about employees, customers and users.

After the RCMP arrest, Vachon-Desjardins was charged with mischief related to computer data, unauthorized use of a computer, extortion and participation in a criminal organization.

In January of this year, he pleaded guilty by video in a Brampton, Ont., courtroom to all charges except unauthorized computer use, and was sentenced to seven years in prison.

RCMP and the Justice Department said in March that Vachon-Desjardins faced similar charges in Florida and was extradited that month.

In Florida court papers dated May 23, Vachon-Desjardins pleaded guilty to four counts. The government recommends that he get a lesser sentence when convicted.

Vachon-Desjardins has agreed to confiscate approximately US$21.5 million remaining from the proceeds of these crimes, along with 27.65 bitcoins, and to cooperate with further investigations.

As part of the deal, he agrees that he “was one of NetWalker Ransomware’s most prolific affiliates.”

The FBI contacted the RCMP in 2020

The RCMP investigation into Vachon-Desjardins began in August 2020 when the FBI requested assistance in identifying a Canadian suspect in their NetWalker investigation.

These Florida court documents show that Vachon-Desjardins infiltrated an anonymous business in Tampa on April 30, 2020.

This company, designated victim 1 in the documents, spent approximately US$1.2 million to return to normal instead of paying the US$300,000 demanded in a note sent by Vachon-Desjardins.

The evidence provided by the FBI to the RCMP allowed it to open its own investigation to find out if crimes had been committed in Canada.

RCMP and Gatineau police raided Vachon-Desjardins’ Gatineau home in January 2021 and seized computer and storage devices, 719 bitcoins (worth tens of millions of dollars) and C$790,000 .

The cryptocurrency seizure was considered the largest in Canada to date in terms of monetary value, the RCMP said at the time.

Public Services and Procurement Canada wrote in an email last March that Vachon-Desjardins had not worked at the department since Jan. 13, but declined to answer further questions about his work history.