Bitfinex Hacker Faces 5 Years, Prosecutors Seek to Deter Crypto Crime

US prosecutors have recommended a five-year prison sentence for Ilya Lichtenstein, who pleaded guilty to a money-laundering conspiracy related to the $6 billion Bitfinex hack. They believe Lichtenstein reflects a troubling pattern among young cyber criminals who normalize their online offenses and underestimate the harm inflicted on their victims, according to a Bloomberg report published today.

In a federal court in Washington, the prosecutors are pushing for “a strong sentence” for Lichtenstein to deter crypto crime. This comes after a court filing last week that recommended Lichtenstein’s wife and co-conspirator, Heather Morgan, serve 18 months in prison. In a court filing on Tuesday, the prosecutors argued that Lichtenstein, the mastermind behind one of the largest cryptocurrency thefts in history, should spend more time in prison.

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Lichtenstein admitted to orchestrating the $4.5 billion cyberattack on Bitfinex, a cryptocurrency exchange owned and operated by iFinex Inc. The couple carried out the plan in 2016, but authorities didn’t arrest them until 2022 for conspiracy and money laundering charges. Authorities seized $3.6 billion from the couple, and U.S. Deputy Attorney General Lisa Monaco described it as the “department’s largest financial seizure ever.”

The government identified Lichtenstein as the main perpetrator of the Bitfinex hack. He laundered the stolen funds with the assistance of his wife, rapper Razzlekhan. Heather Morgan admitted to helping her husband conceal the illicit cryptocurrency even after discovering his involvement in the hack in 2020.

While prosecutors are asking the court to impose a significant sentence for Lichtenstein, they are not seeking the maximum penalty due to his cooperation in the investigation. The couple is scheduled to be sentenced in November 2024.