Bitcoin Billionaire Rapper Busted After FBI Seized Her $3.9 Billion Fortune
The cryptocurrency crime of the century.
The Justice Department is calling it their biggest finance bust in its history, when they arrested Ilya Lichtenstein, 34, and his wife, Heather Morgan, 31, both of New York, New York, who are scheduled to make their initial appearances in federal court today at 3:00 p.m. in Manhattan.
As background, in 2016, there was a breach in security at Bitfinex. As a result, the cryptocurrency exchange was robbed of 119,756 Bitcoin, worth about US$72 million at the time, which were stolen. Today it is worth over $4.5 billion, and the New York couple had over 94,000 Bitcoin stashed in a digital wallet in their possession at the time of their arrest.
Crypto Bonnie and Clyde
The Morning Brew calls the couple Bonnie and Clyde, but unlike the legendary couple, Ilya and Heather probably did their crime at the comfort of their New York apartment.
The couple is also very much public on social media. Heather is known to moonlight as a rapper. She calls herself Razzlekhan on her YouTube channel and goes by the nickname Crocodile of Wall Street.
She also dispenses advice and has written articles for Forbes magazine. In addition, she is active on Twitter, primarily dishing out advice in business, finance, and cryptocurrency.
She once tweeted that she believes it is just a matter of time before Bitcoin will be worthless, the same idea that the Bank of England said a few months ago.
“Bitcoin will become a lesson in economics textbooks of the classic bubble riddled with scams,” Ms. Morgan wrote in a 2014 blog post.
Up to US$400 Million Reward for Return of Stolen 2016 Bitcoin
While the crime happened in 2016, in August of 2020, Bitfinex continued to press for the return of the stolen Bitcoin and has offered up to $400 million in reward money. It continued asking the hackers to return the money through a digital wallet created by Bitfinex to allow the transfer of the Bitcoin back to the cryptocurrency exchange.
Bitfinex offered 30% of the value of the Bitcoin stash in rewards and said that hackers could retain 25% of the value of Bitcoin that they have in possession. So if Ilya and Heather surrendered the Bitcoin, they could have ended up with 25% in value of the stolen Bitcoin, which is close to a billion dollars.
Crime doesn’t pay
While cryptocurrencies can be transferred anonymously, and there is Bitcoin in digital wallets that appear to be abandoned, people know when significant amounts of Bitcoin are transferred. For example, on Twitter, an account that goes by the name of Whale Alert often shares tweets about Bitcoin and other cryptocurrency transfers.
The Justice Department can investigate and find out who owns these digital wallets if there are questionable transactions, especially if transactions transfer small amounts of Bitcoin from one digital wallet to another.
Today, Whale Alert shared a transfer of more than $500 million from one digital wallet to another.
Ilya and Heather, if convicted, could end up serving up to 20 years in prison for money laundering.
And you would wonder, with that kind of money, you would think they would choose to go under the radar, but they decided to become very public on social media.
Further readings.
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