- Ilya Lichtenstein sentenced to 5 years for laundering 119,754 Bitcoin from Bitfinex hack.
- Lichtenstein’s cooperation with authorities led to reduced prison sentence.
- Heather Morgan’s sentencing for her role in crypto laundering set for Nov. 18.
Ilya Lichtenstein, one of the central figures behind the notorious 2016 Bitfinex hack, has been sentenced to five years in federal prison. Judge Colleen Kollar-Kotelly passed the ruling in the U.S. District Court for the District of Columbia.
This case, which exposed one of the largest crypto heists in history, involved the unauthorized acquisition of 119,754 Bitcoin, valued at around $71 million at the time of the hack.
Lichtenstein, who admitted to conspiracy to commit money laundering, received a lighter sentence than initially anticipated. Although he faced a potential maximum sentence of 20 years, the court opted for a five-year term, citing his cooperation with law enforcement.
According to court documents, Lichtenstein’s assistance in other criminal investigations contributed significantly to the leniency in his sentencing.
U.S. prosecutors confirmed that Lichtenstein played a vital role in ongoing probes, which led the court to align the sentence with the prosecution’s recommendation. Despite his crimes’ severity, his cooperation benefitted federal authorities pursuing similar cases.
Lichtenstein’s wife, Heather Morgan, also known for her role in the elaborate scheme, is set to face her sentencing on November 18.
Prosecutors have proposed a comparatively lighter sentence of 18 months for Morgan, arguing that her involvement was primarily in support of Lichtenstein’s activities.
Following the hack, Lichtenstein and Morgan utilized a series of complex methods to obscure the origins of the stolen Bitcoin. The couple reportedly carried out thousands of transactions to launder the funds.
Authorities highlighted using small fund transfers across multiple accounts, digital wallets, and platforms to mask the digital trail.
Investigators also uncovered that the duo diversified their laundering approach by converting portions of the stolen Bitcoin into assets like gold and NFTs. These sophisticated strategies were intended to sever the transaction chain, making it harder for authorities to trace the funds.
In February 2022, federal investigators made a significant breakthrough by arresting Lichtenstein and Morgan. After meticulously analyzing thousands of Bitcoin transactions, law enforcement successfully linked the couple to the Bitfinex hack.
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