New York couple arrested in alleged scheme to launder billions in stolen bitcoin

 

WASHINGTON –  FBI agents arrested a New York couple this morning for allegedly conspiring to launder most of the cryptocurrency stolen during the 2016 hack of a virtual currency exchange that is now worth a whopping $4.5 billion.

Justice Department officials called it a record-shattering amount of stolen currency – digital or otherwise – and said that they have seized at least $3.6 billion in cryptocurrency linked to that hack that they will now try to return to its rightful owners.

So far, authorities have not publicly linked Ilya "Dutch" Lichtenstein, 34, and his wife, Heather Rhiannon Morgan, 31, to the actual hack of the cryptocurrency, saying the investigation is ongoing. They are accused of laundering the $3.6 billion through a series of complicated financial transactions, and diverting unspecified amounts to accounts that they controlled. 

The two were scheduled to make their initial appearances in federal court in Manhattan later Tuesday, but did not enter a plea.

“Today’s arrests, and the Department’s largest financial seizure ever, show that cryptocurrency is not a safe haven for criminals,” said Deputy Attorney General Lisa Monaco.

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“In a futile effort to maintain digital anonymity, the defendants laundered stolen funds through a labyrinth of cryptocurrency transactions,” Monaco said in a statement. “Thanks to the meticulous work of law enforcement, the department once again showed how it can and will follow the money, no matter the form it takes.” 

Assistant Attorney General Kenneth A. Polite Jr. of the Justice Department’s Criminal Division said the arrests should send a signal to cybercriminals that federal authorities are now sophisticated enough to be able to follow money through the blockchain that often camouflages the digital transfer of money. It also shows, Polite said, “that we will not allow cryptocurrency to be a safe haven for money laundering or a zone of lawlessness within our financial system.”