Couple Arrested For Laundering $4.5B in Crypto

Couple arrested for crypto laundering, in connection with a 2016 hack.

It's only February, and we've already seen 2022's "story most likely to be made into a docudrama." On Tuesday, cops arrested a husband and wife on charges of attempting to launder 119,754 stolen bitcoin—worth $4.5 billion.

The Justice Department announced that it had arrested the couple, Ilya Lichtenstein and Heather Morgan, and seized nearly 94,000 of the allegedly stolen bitcoin—worth $3.6 billion. The seizure is the largest in the agency's history.

The bitcoin at issue is linked to a 2016 breach of the crypto exchange Bitfinex, in which hackers exploited a security hole and made over 2,000 illicit transactions—allegedly moving stolen cryptocurrency into a wallet under Lichtenstein's control. At the time of the breach, the stolen crypto was worth $71 million—indicating just how dramatically the currency has appreciated.

Lichtenstein and Morgan allegedly plotted to laundering that stolen bitcoin through a complicated process over the next five years, according to the DOJ. The process involved using fictitious identities to first, deposit the funds into various currency exchanges and darknet markets.  Then they proceeded to withdraw some as cash from Bitcoin ATMs, and spent some on NFTs, gold, and Walmart gift cards. The DOJ says the couple also deposited some of the funds into their personal bank accounts.

But this isn’t just a tale about laundering money. This is a story about millennials laundering money.

Crime is Just a Side Job

The husband-and-wife team of Morgan and Lichtenstein aren't your typical  couple charged with laundering stolen crypto. Both are extremely, almost inconceivably, online. Lichtenstein's account on Twitter frequently talks about Web3 and cryptocurrency.

Morgan, like so many other individuals born in the late 1980s, has a YouTube channel where she performs laughably terrible rapping as "Razzlekhan"—wherein she refers to herself as the "crocodile of Wall Street." She’s also a former Forbes writer. In June 2020, she penned an article about how companies can defend themselves from hackers.

For money laundering charges, the pair faces a maximum of 20 years in prison.

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