Borneo authorities uncover illegal mining activities in power theft operation

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Local authorities on the island of Borneo have busted the activities of an illicit digital currency mining operation relying on stolen electricity.

Malaysian energy provider Sarawak Energy and local law enforcement teams raided an apartment complex suspected of housing an illegal mining operation. Following a tip-off, the raid led to the seizure of 34 mining servers, with authorities preparing for a manhunt for the suspects.

The illicit mining operation involved power theft using tapping cables to circumvent metered readings. According to Sarawak Energy, the illegal scheme cost the firm up to RM 6,000 ($1,300) per month but it remains unknown how long the scheme has been in operation.

“All the equipment used for the mining operation, including the direct tapping cables and servers, were seized,” Sarawak Energy said in a statement. “A police report has been lodged and an investigation is currently underway.”

Sarawak Energy warned that power theft for the purposes of digital currency mining poses grave public risks. The utility company stated that apart from consuming large amounts of electricity, the mining systems are not rigged with a cooling system to address the problem of overheating.

Improper installations from illegal miners have been found to cause short circuits, leading to fire outbreaks in Borneo.

The firm warned landlords to carry out due diligence to ensure that their properties are not used to steal electricity while warning members of the public to avoid claims of reduced electricity charges through illegal meter wirings.

Sarawak Energy noted that it will be upping its supervisory operations to bust electricity theft on the island, focusing on “tampered meters, counterfeit electricity meter covers, and underground direct tapping.” The company unveiled a whistleblowing policy for the public to report suspected power theft, pledging confidentiality for whistleblowers.

The whistleblowing policy led to the uncovering of three illegal cryptocurrency mining operations in Senadin, Malaysia, in early 2023. At the time, Sarawak Energy’s statement revealed that authorities seized over 137 mining servers from the three locations.

Tough time for miners

As miners continue to navigate the uncertainties of a bear market, several mining companies have undergone a rebrand to diversify their operations. In July, BTC mining firm Hive Digital (NASDAQ: HIVE) removed “Blockchain” from its name, signaling a foray into artificial intelligence (AI). Riot Blockchain also rebranded to Riot Platform to diversify its operations in the wake of an extended bear market.

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