I think it is time to launch a website of cryptoscams so yes, I’ve done it. It’s called cryptocrim.com, a space where all the crypto criminals will be thrown into Room 101, a place where you can consign anything you hate to history (although George Orwell had other ideas).
The new site will be live soon and the reason for launching this site is that, after so many crypto scams and rip-offs, I’ve decided to keep a shortlist of updates of those that are the worst or the greatest. The list will include Celsius, TerraUSD-Luna, FTX, MtGox, Three Arrows Capital, Quadriga, OneCoin and more … but, as it’s just starting, let’s begin with bitcoin Bonnie and crypto Clyde.
A married couple nicknamed “Bitcoin Bonnie and Crypto Clyde” have pleaded guilty to laundering $4.5 billion (£3.5bn) in stolen cryptocurrency.
Heather Morgan and Ilya Lichtenstein were arrested in New York last year after police linked their lavish lifestyle to a crypto heist, in what the US Justice Department called its “largest financial seizure ever”. The Justice Department managed to recover £2.8bn out of the stash of some 120,000 bitcoin, which is today worth £3.5bn. Prosecutors said the pair stole the bitcoin in 2016 using “advanced hacking tools”.
As part of a deal, the pair pleaded guilty to money laundering, while Lichtenstein admitted to being behind the hack and Morgan pleaded guilty to an additional count of conspiracy to defraud the US.
Despite her moves to hide her crimes, Morgan masqueraded as a rapper and tech entrepreneur who called herself a “bad-ass money maker” and “the crocodile of Wall Street” in her lyrics.
Heather and husband Ilya were running a crypto scam firm called Bitfinex. Folks investing bitcoin in Bitfinex did not know that the couple converted the investments into US dollars clearly in the light of day. It was purely a hack flow where money went directly from the firm into their pockets. The pair also purchased gold coins and set up shell companies to make the bitcoin funds look legitimate.
So, how did they get found out?
Well, they accidentally exposed themselves by using a gift card paid for with the stolen funds from Bitfinex, when paying for goods in a Walmart supermarket.
“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,” said Jonathan Levin, founder of cryptocurrency investigators Chainalysis, who participated in the investigation.
I guess there are two questions:
1) How did they get away with it?
Prosecutors claimed the couple used fake identities to create online accounts and disguise their trail of transactions by depositing and withdrawing the stolen funds from virtual exchanges and darknet markets.
2) Why Bonnie and Clyde?
There are few couples who have made headlines in quite the same way as Bonnie Parker and Clyde Barrow. The two criminals are known for a series of bank robberies, murders, and kidnappings that took place between 1932 and 1934, the height of the Great Depression.
So, welcome to 2023 where bitcoin Bonnie and crypto Clyde strike again.
Chris M Skinner
Chris Skinner is best known as an independent commentator on the financial markets through his blog, TheFinanser.com, as author of the bestselling book Digital Bank, and Chair of the European networking forum the Financial Services Club. He has been voted one of the most influential people in banking by The Financial Brand (as well as one of the best blogs), a FinTech Titan (Next Bank), one of the Fintech Leaders you need to follow (City AM, Deluxe and Jax Finance), as well as one of the Top 40 most influential people in financial technology by the Wall Street Journal's Financial News. To learn more click here...