An Australian former defence contractor has been accused of accepting over $1.26 million in cryptocurrency in exchange for selling sensitive cyber tools to a Russian broker, in a case that prosecutors say caused $35 million in losses and threatened the national security of the Five Eyes intelligence alliance.
Peter Williams, a former Australian Air Force staffer and defence contractor residing in the United States, is alleged to have sold eight protected cyber exploit components, including zero-day capabilities, to a notorious Russian exploit broker. The transactions, conducted via anonymized cryptocurrency payments, spanned several years and continued even after Williams was aware of an FBI investigation into the matter.
According to a sentencing memo, Williams was set to receive additional payments of up to $4 million under his cooperation agreements with the broker. Prosecutors state he used the illicit crypto funds to finance a lavish lifestyle, including luxury cars, jewelry, holidays, and a $1.5 million down payment on a property in Washington.
The case has raised significant alarm within the Five Eyes alliance—comprising the United States, United Kingdom, Canada, Australia, and New Zealand—as the sold tools could penetrate sensitive defence systems used by member nations. Prosecutors are seeking a nine-year prison sentence, $35 million in mandatory restitution, a $250,000 fine, and three years of supervised release.
This incident highlights the growing use of cryptocurrency in espionage and covert cyber operations. Authorities note that the borderless and private nature of crypto transactions allows them to occur outside traditional financial surveillance, making them an attractive tool for state actors and illicit brokers. Recent global cases, including in Poland and Israel, have shown a pattern of cryptocurrencies being used to fund espionage activities.
