Tuesday, February 11, 2025

Feds Recommend 5-Year Jail Term for Bitfinex Hacker Behind 120K BTC Heist

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Originally published on: October 17, 2024

In a recent development, federal prosecutors in the United States are advocating for a five-year prison sentence for the individual responsible for the theft of 120,000 Bitcoin from cryptocurrency exchange Bitfinex back in 2016.

According to court filings on October 15, Ilya Lichtenstein, the hacker behind the elaborate scheme, may receive a reduced sentence from the initial 20 years he was facing after pleading guilty to a single count of conspiracy to commit money laundering.

The prosecutors highlighted Lichtenstein’s lack of prior criminal history and his willingness to provide valuable assistance that facilitated numerous investigations as factors that warrant a lighter sentence for him.

It was revealed that Lichtenstein only managed to launder 25,111 Bitcoin out of the total stolen amount, which was valued at $71 million at the time. His attempts to erase evidence that could implicate him did not hinder the investigative process significantly.

While Lichtenstein’s wife and accomplice, Heather Morgan, could potentially face 18 months behind bars for her involvement in laundering the stolen cryptocurrency, prosecutors are pushing for a lengthier sentence for Lichtenstein due to the extensive planning and execution of the heist.

The prosecutors emphasized that imposing a more substantial sentence is crucial in deterring similar crimes in the future and reflecting the severity of the offense committed. They also stressed that the recovery of the stolen funds was primarily thanks to law enforcement intervention rather than the defendants’ voluntary cooperation.

The sentencing for Lichtenstein is scheduled for November 14, with his wife’s sentencing following on November 15. Both are expected to return the seized cryptocurrency assets to Bitfinex as part of the restitution process.

This case exemplifies a new breed of cybercriminals, and prosecutors have warned against normalizing such criminal activities, emphasizing the importance of acknowledging the victims’ suffering in cases of online theft and fraud.

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