Hacker Sentenced For Bitcoin Theft

Uploaded on 2024-11-15 in TECHNOLOGY--Hackers, NEWS-Cybersecurity News, GOVERNMENT-Law Enforcement, FREE TO VIEW

A skilled and prolific hacker has been given a five year sentence on 14th November for laundering the proceeds of one of the biggest ever crypto-currency thefts. His crime involved the the 2016 theft of a reporedt 120,000 bitcoin from cryptocurrency exchange Bitfinex, worth over $9bn at today's heightened exchange rate.

Now, Ilya Lictenstein has been sentenced to five years in jail after he attempted to launder the money with the help of his wife Heather Morgan, who used the alias 'Razzlekhan' to promote her career in pop music. His wife earlier pleaded guilty to one count of conspiracy to commit money laundering and is due to be sentenced next week.

According court documents, Lichtenstein hacked Bitfinex using advanced hacking tools: once inside the network, he fraudulently authorised more than 2,000 transactions transferring 119,754 bitcoin from Bitfinex to a crypto-currency wallet in Lichtenstein’s control. In a statement, the US Dept. of Justice said “Lichtenstein then took steps to cover his tracks by deleting from Bitfinex’s network access credentials and other log files that could have revealed his conduct to law enforcement... Following the hack, Lichtenstein enlisted the help of his wife, Heather Morgan, in laundering the stolen funds,”

At the time of the theft, the bitcoin was worth around $70m (£55.3m), but had risen in value to more than $4.5bn by the time they were arrested. At current prices the bitcoins are worth more than double that.

Lichtenstein, who has been in prison since his arrest in February 2022, who is 35, has been ordered to serve three years of supervised release following his release from imprisonment. This apparently lenient sentence for a theft of such magnitude was perhaps mitigated by his pledge to apply his skills to fight cybercrime after serving his sentence.

US District Judge Colleen Kollar-Kotelly told Lichtenstein that his theft was “meticulously planned” and not an impulsive act. Lichtenstein used advanced techniques, which included using fictitious identities, switching the funds into different cryptocurrencies and buying gold coins. Lichtenstein was born in Russia but grew up in the US would meet couriers to move the laundered money to Russia.

His wife produced dozens of expletive-filled music videos and rap songs filmed in locations around New York in which she described herself as a "bad-ass money maker" and "the crocodile of Wall Street".

Image: @HeatherReyhan

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