📣 Bitfinex Hacker Sentenced to Five Years in Prison
posted 15 Nov 2024
Ilya Lichtenstein, who hacked the Bitfinex cryptocurrency exchange and laundered 119,754 BTC (now valued at approximately $10.5 billion), received a five-year prison sentence instead of the potential twenty, thanks to his collaboration with authorities. At the time of the hack, the stolen assets were valued at $71 million.
According to the investigation, Lichtenstein was a highly skilled cybersecurity specialist who employed advanced techniques to breach the Bitfinex platform. After gaining access, he transferred the stolen Bitcoin—over 2,000 transactions in total—to his personal cryptocurrency wallet.
This is so massive, it is not comparable to other crypto crimes,said US District Judge Colleen Kollar-Kotelly.
Following the hack, Lichtenstein and his wife and accomplice, Heather Morgan—known by her rap alias Razzlekhan—engaged in laundering the stolen funds. They created fake bank accounts, conducted small, traceable transactions, and utilized the darknet to conceal their activities.
The couple also invested the stolen assets in gold, NFTs, and even Walmart gift cards. Prosecutor Jessica Peck highlighted their meticulous efforts, noting that they managed to launder only 21% of the stolen funds before being apprehended.
The government significantly reduced Lichtenstein’s sentence, citing his valuable cooperation in various cryptocurrency investigations. For example, he provided testimony in a case involving Bitcoin Fog, a mixing service used for laundering money.
Law enforcement officials expressed optimism that Lichtenstein could rehabilitate after serving his sentence. Lichtenstein pledged to use his expertise in the future to improve cybersecurity and combat cybercrime. He also appealed to the court for leniency toward his wife.
Prosecutors recommended an 18-month prison term for Heather Morgan, acknowledging her comparatively minor role in the crimes. Both Morgan and Lichtenstein admitted guilt roughly a year ago.
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