The DOJ seized more than $3 billion in Bitcoin from a 2016 Bitfinex hack and arrested a couple from Manhattan for attempting to launder crypto tied to the hack so let’s read furhter in our latest cryptocurrency news.
The DOJ seized more than $3 billion from the 2016 hack and two individuals have been arrested on charges of conspiracy to launder crypto. So far, law enforcement seized the funds linked to the hack according to the reports. Deputy Attorney General Lisa O. Monaco noted:
“Today’s arrests, and the department’s largest financial seizure ever, show that cryptocurrency is not a safe haven for criminals. In a futile effort to maintain digital anonymity, the defendants laundered stolen funds through a labyrinth of cryptocurrency transactions. Thanks to the meticulous work of law enforcement, the department once again showed how it can and will follow the money, no matter what form it takes.”
According to a Bitfinex spokesperson, we can see that:
“We’re pleased that DOJ has recovered a significant portion of the bitcoin stolen during the 2016 hack. We have been cooperating extensively with DOJ since its investigation of this incident began.”
Another spokesperson from Tether added that Bitfinex has more plans to continue working with the Department of Justice to regain the stolen BTC:
“Bitfinex intends to provide further updates on its efforts to obtain a return of the stolen bitcoin as and when those updates are available.”
According to the DOJ statement, federal law enforcement arrested Ilya Lichtenstein and his wife Heather Morgan. Both of them are from New York and are scheduled to make initial appearances in the federal court. Both of them are charged with conspiracy to commit money laundering and to defraud the US. These charges carry 20 and five years in prison respectively. According to the court documents, both parties conspired to launder more than 119,754 BTC all stolen from the Bitfinex platform when it was hacked in 2016.
During the hack, more than 2000 unauthorized transactions sent the funds to a digital wallet which was under Lichtenstein’s control according to authorities. Eventually, through a complicated money laundering process, the DOJ says some of the funds ended up going into traditional accounts that are operated and controlled by both parties. The rest of the stolen funds worth 94,000 BTC, remained in Lichtenstein’s wallet as per the DOJ and the federal agents obtained access to the files after the court-authorized search warrants that got executed. Attorney Matthew M. Graves noted:
“Cryptocurrency and the virtual currency exchanges trading in it comprise an expanding part of the US financial system, but digital currency heists executed through complex money laundering schemes could undermine confidence in cryptocurrency.”
In terms of how the funds were moved, the federal authorities said both parties used plenty of sophisticated laundering techniques. These included the use of fake identities to set up online accounts, utilizing computer-based programs to automate transactions, and to also deposit stolen funds into accounts from exchanges and the darknet.
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