Also, Heather Morgan and Ilya Lichtenstein were arrested in New York last year when authorities traced their wealth back to a Bitcoin heist.
In addition, Though the couple both pleaded guilty to money laundering, Morgan pleaded guilty to an additional count of conspiracy to defraud the United States.
Morgan disguised herself as a rapper and tech entrepreneur, publishing dozens of expletive-filled music videos and rap songs filmed across New York, under the name Razzlekhan. In her lyrics, she referred to herself as a “bad-ass money maker” and “the crocodile of Wall Street”.
Heather Morgan and her husband, Lichtenstein who is a programmer, were attempting to cash out their fortune stolen from the crypto firm Bitfinex.
Currently, the couple faces prison sentences with husband Lichtenstein in line for a possible maximum of 20 years in prison and Morgan a possible 10 years in prison.
As of February 2022 when they were arrested, the stash of 119,000 Bitcoins laundered was worth about $4.5bn – making it the US Department of Justice’s largest single financial seizure in its history. During the hack, the Bitcoins were worth about $71m.
However, According to BBC reports, records show the couple:
- Split up the Bitcoin into tiny amounts and transferred it to thousands of different crypto wallets with fake identities
- Mixed their stolen funds with other criminal cryptocurrencies on the darknet marketplace Alphabay
- Purchased gold coins
- Set up shell companies to make the Bitcoin funds look legitimate
The couple made a key mistake by shopping with Walmart supermarket vouchers, paying for them with the stolen funds. According to Jonathan Levin, founder of cryptocurrency investigators Chainalysis “Police were able to link the Walmart gift cards back to some of the proceeds of the Bitfinex hack, which then opened up the further investigation.”
When police searched the couple’s Manhattan apartment, they found; books cut out in the middle to hide mobile phones, dozens of burner handsets, USB sticks, and $40,000 in cash.
Ilya Lichtenstein had kept meticulous records of how they were laundering the stolen Bitcoin.
According to prosecutors, communication records uncovered indicated Morgan and Lichtenstein were planning to flee the US for Russia – Lichtenstein’s country of birth. If their mission had been possible, they would have led a luxurious lifestyle in Russia, avoiding arrest by the US.
