Ilya Lichtenstein, the 35-year-old husband of Heather Morgan, also known as Razzlekhan, has been sentenced to five years in prison for his role in the 2016 theft of around 120,000 bitcoin from the cryptocurrency exchange Bitfinex, as announced by the US Department of Justice. Lichtenstein utilized sophisticated hacking tools to gain access to the network and then fraudulently authorized over 2,000 transactions to transfer the stolen bitcoin to his own wallet. He attempted to conceal his actions by deleting access credentials and log files from Bitfinex's network. Following the hack, Lichtenstein and his wife laundered the stolen funds, with Morgan set to be sentenced on November 18.
The prosecution has recommended an 18-month sentence for Morgan. According to court documents, the couple successfully laundered 25,111 bitcoin, approximately 21% of the total stolen amount, using complex methods involving Eastern European bank accounts and bitcoin mixing services. These methods included using automated computer programs for transactions, depositing funds into darknet markets and cryptocurrency exchanges, and converting bitcoin into other cryptocurrencies.
Despite the complexity of these methods, some have criticized Lichtenstein's approach as amateurish. Lichtenstein and Morgan initially faced suspicion for money laundering but were not charged in relation to the actual hack.
Instead, they pleaded guilty to conspiracy to commit money laundering, a charge carrying a maximum sentence of 20 years in prison. In addition to his five-year prison term, Lichtenstein will serve three years of supervised release.