Wife Freed, Husband Jailed Awaiting Trial in Billion Dollar Bitcion Laundering Case

Wife Freed, Husband Jailed Awaiting Trial in Billion Dollar Bitcion Laundering Case

The alleged scammer, nicknamed the Wall Street Crocodile for claims she laundered $4.5 billion in bitcoin, has been released on bail but her husband has been ordered to remain in jail.

Heather Morgan was released by a New York judge on Monday before trial in federal court. But her husband, Ilya Lichtenstein, remains behind bars because of prosecutors’ fears that he could seek immunity in Russia, of which he is also a citizen.

Judge Beryl Howell said on Monday that Morgan, 31, known as “Razzlekan” because of her rap history, is no longer being held after the government deemed she was not as involved in planning the alleged crimes as her 34-year-old husband, Ilya Lichtenstein, who was largely in control of the funds.

The judge also factored in Morgan’s health issues after she recently had surgery to remove a tumor in her breast. With follow-up appointments expected, she will be closely monitored via a GPS monitor with an ankle bracelet while she is under house arrest.

Morgan also received restrictions on the use of a computer and a ban on conducting cryptocurrency transactions.

The defense told the court that both defendants guaranteed attendance at all remaining court hearings, and pointed out that both of their families, who were present in court, were ready to put their houses on it.

However, Howell eventually ruled that there was significant “flight risk” for Liechtenstein and agreed with federal prosecutors who insisted that only a fraction of the millions of crypto stolen by the couple could buy a new home or “buy each of their parents’ apartment. private island.

The judge also shared her fears that Liechtenstein, who has dual US and Russian citizenship, might seek asylum in an Eastern European country where he could be granted immunity.

In this courtroom sketch, lawyer Sam Enzer (center) sits between Heather Morgan (left) and her husband Ilya

In this courtroom sketch, lawyer Sam Enzer (center) sits between Heather Morgan (left) and her husband Ilya “Dutch” Lichtenstein in federal court on February 8, 2022 in New York City. The couple are accused of conspiring to launder billions of dollars in cryptocurrency stolen in a virtual currency exchange hack in 2016.

This illustration photo shows Heather Morgan, also known as

This illustration photo shows Heather Morgan, also known as “The Razzlehan”, with a phone in front of the Bitcoin logo displayed on the screen. Along with Liechtenstein, Morgan was arrested for the couple’s bitcoin laundering scheme, but was released after posting bail.

Federal prosecutors also said Liechtenstein had a file on his computer called “passport ideas” that mentioned several dark web vendors who sell passports, bank cards and other forms of identification.

A New York couple were arrested earlier in February after they conspired to launder a cryptocurrency that was stolen during the 2016 hack of Bitfinex, a virtual currency exchange platform, and is currently valued at $4.5 billion. .

Both are accused of using several methods to launder Bitcoin, including using fake IDs to create accounts; coding computer programs to perform fast automated transactions; placing stolen funds on multiple accounts on the same crypto exchange to cover their previous transactions; converting bitcoins to other forms of cryptocurrency; and setting up US business accounts to transfer your funds and make them legal.

Over five years, the hacker allegedly laundered 119,754 bitcoins in 2,000 transactions on the Bitfinex website before transferring the cryptocurrency to Liechtenstein’s digital wallet.

The couple face up to 25 years in prison if proven guilty.

Liechtenstein (back) was not released on bail after prosecutors warned the judge of his Russian citizenship, where he could seek immunity if he was no longer held in custody.

Liechtenstein (back) was not released on bail after prosecutors warned the judge of his Russian citizenship, where he could seek immunity if he was no longer held in custody.

Morgan has been called an

Morgan has been called an “essential player” in the cryptocurrency laundering scheme, but prosecutors have called Lichtenstein the “brains” behind the scheme’s operations.

Bitfinex is a cryptocurrency exchange registered in the British Virgin Islands. In August 2016, hackers managed to breach his security firewall before stealing around 120,000 bitcoins from his customers.

The amount stolen was roughly $70 million at a time when the price of bitcoin was around $600.

At the time, Bitfinex announced to its customers that they would lose 36 percent of their funds to make up for losses from the incident. Special digital tokens were also created that could track customer losses.

Some tokens can be exchanged for shares in iFinex, the company that runs Bitfinex, and other tokens can be redeemed if the stolen bitcoins are returned in the future.

The US Department of Justice has announced that it will create a special lawsuit for hack victims to recover their losses.

The hackers were never identified.

Morgan and Lichtenstein were arrested by federal prosecutors for laundering bitcoins stolen from Bitfinex, but they are not charged with actually stealing bitcoins during the hack.

Authorities managed to recover $3.6 billion after seizing the couple’s private keys to digital wallets following their arrest earlier this month.

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