News - Couple steals billions of dollars of BTC from crypto exchange

By Mike Hesp

Couple steals billions of dollars of BTC from crypto exchange

Bitcoin (BTC)
Exchanges
Scams, crime and fraud

A married couple has confessed to stealing billions of dollars from the crypto exchange Bitfinex. They risk prison terms of several years.

Ilya Lichtenstein and Heather Morgan have confessed in court to stealing about 120,000 Bitcoin from the crypto exchange Bitfinex. In an attempt to launder the money, about US$4 billion, they were arrested in February 2022. German investigators were also involved in the investigation. The pair now face many years in prison.

Up to 20 years for Bitfinex hackers

The case, one of the largest crypto hacks in history, made headlines worldwide. The attack on the exchange took place back in 2016, but the pair were not caught until last spring. "After seven years, these efforts have now paid off," a Bitfinex spokesperson told news platform BTC-ECHO. During that time, they worked closely with the U.S. Department of Justice.

Among other things, the suspects allegedly tried to cover up tracks using so-called cryptomixers. Eventually, this brought them to the attention of investigators. Ansbach police were also involved.

The research is "an excellent example of how blockchain analytics combined with traditional financial investigation techniques can enable law enforcement agencies to solve crimes involving cryptocurrencies, obtain convictions and seize stolen money," Chainalysis explained in a press release. The blockchain analytics company was also involved in the study.

Lichtenstein pleaded guilty to conspiracy to launder money. He faces up to 20 years in prison. Morgan pleaded guilty to one count of conspiracy to launder money and one count of conspiracy to defraud the United States. The maximum prison term is five years for each charge.

Parts invested in gold coins

According to the court documents Lichtenstein used "a number of sophisticated hacking tools and techniques to gain access to Bitfinex's network." He reportedly penetrated the systems and authorized "more than 2,000 transactions." In the process, "119,754 Bitcoin were transferred from Bitfinex to a cryptowallet managed by Lichtenstein." He then logged into Bitfinex to cover his tracks. His wife Morgan, who had a fairly successful rap career as "Razzlekhan," reportedly helped launder the stolen money.

The couple reportedly used "numerous sophisticated techniques" to do so, "including using fictitious identities to create online accounts." Funds were allegedly transferred to accounts on darknet markets, stolen Bitcoin was exchanged for other cryptocurrencies and laundered through cryptomixers. Some was also invested in gold coins, "which Morgan then buried."

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