$3.6 billion in Bitcoin seized from Crocodile of Wall Street

pushups44

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Quote from: e_abrams on February 09, 2022, 10:17:25 AM

What I find absolutely baffling is that this woman made herself so visible while laundering money. What was the plan there? Hide in plain sight? Was she just arrogant, thinking she wouldn't get caught? It's so strange.

Arrogance is a good way to put it. Come to think about it, while I'm no psychologist and this is a wild guess, it seems this chick could be exhibiting signs of narcissism. Like you point out, why the need, with so much loot, to put herself on social media so ridiculously? This went beyond money. This woman craves attention.

pushups44

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Even if they were given the loot to clean and obfuscate it, this is good news for crypto as it shows the bad guys can get caught, and the more they steal the more attention they bring to themselves. I'm inclined to believe there are other parties involved in this, and perhaps as this case develops more light will be shined on accomplices - though it's possible these two will simply be the fall guys to officially close the case for political expediency.

OgNasty

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You can see one of her music videos here:
https://www.youtube.com/watch?v=8IUyltbbFZM

I'm a damn fan now... I don't know if this girl is the Milli Vanilli of hackers or what. It seems a bit crazy to me that this is the person who was holding billions of dollars worth of BTC and not a "fall guy", but it's an awesome story. I guess if you come up on billions of dollars overnight this is the level of not giving a fuck you achieve. I wish more people were this awesome. It would make life a lot more fun and interesting. I hope she's able to bail out and make the most of out of this fame before she's stuck in a cage forever by the powers that be.

"Always be a goat, not a god damn sheep."
- Razzlekhan

coolcoinz

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Quote from: Bttzed03 on February 09, 2022, 04:36:45 AM

Quote from: cheezcarls on February 09, 2022, 04:08:48 AM

Okay so what happens next? Will the seized Bitcoin be dumped by the government and crashing the market all the way downhill?

I think it will be returned to Bitfinex because they are the rightful owner and they must have filed a case somewhere. For the meantime, those BTCs will be in the control of the law enforcers while the investigation is ongoing.

If ever I'm wrong and that the Justice Department were allowed to dispose them, I don't think it will be dumped on open market. It will be done through OTC or through an auction just like what happened to the Silk Road BTC.

Most likely it's going to be returned. If the money came from an illegal source it also wouldn't be dumped. It would be treated like coins from Silk Road and put on auction. These auctions usually fetch similar or higher prices than current market value so it's never worth it for people to dump it right away. An auction is one of the safest ways to get a lot of coins at once because you get them all at the same price. If you wanted to buy 100 million of btc on an exchange you'd end up pumping the price and paying more.

As for the alleged hacker, I think this picture posted by someone on her facebook page speaks a thousand words about the situation:

e_abrams

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What I find absolutely baffling is that this woman made herself so visible while laundering money. What was the plan there? Hide in plain sight? Was she just arrogant, thinking she wouldn't get caught? It's so strange.

arabspaceship123

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I've changed the size. Thanks.

Quote from: Darker45 on February 08, 2022, 08:39:15 PM

What's with the very large images? You can actually narrow them down by placing width=400 or 500 or whatever size is preferable to you right after [img. Like this, [img width=400]. Perhaps you preferred it this way, but it's a little irritating to the eyes, especially because you posted more than one.

Anyway, I should congratulate the law enforcers for finally seizing the stolen Bitcoin. Although not everything was recovered, at least around 80% has already been confiscated. That's a huge success.

And, unlucky and extremely foolish for both Lichtenstein and Morgan for keeping the private keys in an online account. Both of them are either stupid or too complacent to store online the keys to the wallet where the billions in Bitcoin was stored.

The authorities must be very close to the real culprit.

stompix

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Quote from: Kemarit on February 08, 2022, 08:44:28 PM

And based on the images and their lifestyles, they are living big and obviously you have to question where all the wealth is coming.

Why some shiny clothes and sunglasses are suddenly proof of wealth?
I've seen thousands of guys and girls who post like that and some of them work at Aldi or for Uber and other delivery companies.

Quote from: KaliLinux on February 09, 2022, 02:47:11 AM

I don't really understand why most of these people that come to the crazy amount of wealth illegally usually display this stuff on social media like they legitimately got them and that the law will not catch up with them. I hope this "Allegedly" will eventually be confirmed as true and their connections will be established so that they can face the result of their actions from the pain they put others through.

I don't get where poeple here get this impression of them displaying wealth on any of those social media
https://www.facebook.com/razzlekhanrap/

I've gone through hundreds of posts and I can barely see one or two screaming I have tons of money
For gods' sake even in the only one pic with a banknote, she uses a twenty, not a one hundred Grin

Bttzed03

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Quote from: cheezcarls on February 09, 2022, 04:08:48 AM

Okay so what happens next? Will the seized Bitcoin be dumped by the government and crashing the market all the way downhill?

I think it will be returned to Bitfinex because they are the rightful owner and they must have filed a case somewhere. For the meantime, those BTCs will be in the control of the law enforcers while the investigation is ongoing.

If ever I'm wrong and that the Justice Department were allowed to dispose them, I don't think it will be dumped on open market. It will be done through OTC or through an auction just like what happened to the Silk Road BTC.

cheezcarls

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Okay so what happens next? Will the seized Bitcoin be dumped by the government and crashing the market all the way downhill? Looks like that it's going to be their true intention once BTC picks up again like rallying to a possible new all-time high!

If those keys were not stored online, they may have a hard time looking around the house just to find the seed phrases or private keys offline.

Jating

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Quote from: lovesmayfamilis on February 09, 2022, 02:21:03 AM

"When the police got the search warrant, they managed to find the private keys" - I wonder where they kept their keys?
Were the keys in Heather's makeup bag? (ironic)

It was kept on the cloud, and the DOJ was able to crack the password and walla!!! all the private keys are sitting there.

Quote from: lovesmayfamilis on February 09, 2022, 02:21:03 AM

Just having such possessions and not taking care to make it impossible to find the keys seems a bit silly and weird. I don't side with the criminals, but logically, the first thing the criminals do is go to great lengths to make sure the police can't get their hands on the keys. In another case, it can be assumed that pressure was exerted on them, opening all places where the keys were not hidden.

I don't think they are technically inclined though, they are not the hackers, just the keepers of those bitcoin. We will have to find out how the they got the bitcoin from the hackers though, what is their connection. The hackers were caught in 2019, and probably spill their names, that's what I suspect on how the DOJ got a hold of these two and then started to work their way on cracking all their online identifies i.e social media accounts, online wallets and others.

lovesmayfamilis

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Quote from: KaliLinux on February 09, 2022, 02:47:11 AM

I don't really understand why most of these people that come to the crazy amount of wealth illegally usually display this stuff on social media like they legitimately got them and that the law will not catch up with them. I hope this "Allegedly" will eventually be confirmed as true and their connections will be established so that they can face the result of their actions from the pain they put others through.

Everything is clear here, because the money is stolen, where else to spend your free time and stolen money? Real millionaires rarely use social media, simply because they don't have time for all this nonsense. Even the owners of social networks rarely or do not use social networks at all. They are in business, all they have is natural, they do not think that it is necessary to show off, but the mind of scammers seems to be set differently. But it is the arrogance of such people that most often attracts supervisory authorities. A good proverb says: "Money loves silence"

KaliLinux

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Quote from: cabron on February 08, 2022, 09:33:42 PM

Quote from: Kemarit on February 08, 2022, 08:44:28 PM

Quote from: crwth on February 08, 2022, 08:21:33 PM

So they are just in connections with the hackers and they are in charge of making the money clean and not traceable, right?

Yes, most likely this is the case here, we are not sure how they know the hackers, maybe the hackers contacted them or what. But it's clear that the DOJ has trace the trail of the stolen Bitfinex hacked and identify it to Ilya Lichtenstein and Heather Morgan.

And based on the images and their lifestyles, they are living big and obviously you have to question where all the wealth is coming.

Old police work I think. When there is a big heist and someone suddenly living a high life, arise suspicions. People around them sure wonder where they get thier money and if they think like they can buy just about anything and brags about it on social media being a croc on wall street, it's odd. Normally they are sheep and wolves. Grin

The DOJ didn't mention how they are connected to the hackers so this is still a classified doc? The term "Alleged" still makes them not guilty yet.

I don't really understand why most of these people that come to the crazy amount of wealth illegally usually display this stuff on social media like they legitimately got them and that the law will not catch up with them. I hope this "Allegedly" will eventually be confirmed as true and their connections will be established so that they can face the result of their actions from the pain they put others through.

enquirer

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Quote from: lovesmayfamilis on February 09, 2022, 02:21:03 AM

"When the police got the search warrant, they managed to find the private keys" - I wonder where they kept their keys?
Were the keys in Heather's makeup bag? (ironic)
Just having such possessions and not taking care to make it impossible to find the keys seems a bit silly and weird. I don't side with the criminals, but logically, the first thing the criminals do is go to great lengths to make sure the police can't get their hands on the keys. In another case, it can be assumed that pressure was exerted on them, opening all places where the keys were not hidden.

Looks like the keys were in an encrypted file in Google drive. FBI was able to decrypt the file. Could have installed a keylogger in Ilya's computer to get the password or something like that.

lovesmayfamilis

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"When the police got the search warrant, they managed to find the private keys" - I wonder where they kept their keys?
Were the keys in Heather's makeup bag? (ironic)
Just having such possessions and not taking care to make it impossible to find the keys seems a bit silly and weird. I don't side with the criminals, but logically, the first thing the criminals do is go to great lengths to make sure the police can't get their hands on the keys. In another case, it can be assumed that pressure was exerted on them, opening all places where the keys were not hidden.

enquirer

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Quote from: crwth on February 08, 2022, 08:21:33 PM

So they are just in connections with the hackers and they are in charge of making the money clean and not traceable, right?

There isn't anything in the document that indicates that anyone else was involved. IMO Ilya IS the hacker, because he had private keys to all 2000 original theft addresses.

They just went for the arrest warrant for money laundering because this is what they can prove now - Ilya lied about source of funds in his emails to banks and cryptoexchanges. They will get to the hacking point while he sits in jail.

avikz

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It's always great to know that criminals and frauds are getting caught brought under the wings of law. 3.6 billion is a huge amount, it can solve the hunger problem of entire African continent. So I have just one question - now what DOJ will do with this money? Are Bitfinex users going to get a refund? Or this money will rot in the hands of government departments without any further news of expenditure?

Government departments seizing money from criminals, is a good thing! But if this money is not used for its rightful purpose, then government needs to re-think their approach because this money doesn't belong to government either!

traderethereum

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Quote from: goldkingcoiner on February 08, 2022, 10:56:58 PM

Thats surprisingly dumb of them to get caught. But now that all that money has been seized, what will happen to it now? Are they going to return the money to the respectful owners / Wallets or are they going to keep them? If they keep them as stolen goods, I take it they won't be sold/auctioned off anytime soon? Honestly with the US justice system being the absolute dumpster fire it is, I would be nervous as to how this is going to affect the Bitcoin price in the short term.

Also, what kind of amateurs can't keep 3.6 Billion to themselves? How did they even get caught? Should of Hodled it.

They think that they have a lot of money they can cash out to buy anything they want at that time.
Maybe they forget not to use too big an amount of bitcoin to cash out because that can make the alarm sound and the officers hunt them.
Hopefully, that will not affect the market to go down instead of bounce to the high price and back to $45k.
If they still hold some bitcoins in secret places, they will have a chance to use them when they are free in the future.

goldkingcoiner

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Thats surprisingly dumb of them to get caught. But now that all that money has been seized, what will happen to it now? Are they going to return the money to the respectful owners / Wallets or are they going to keep them? If they keep them as stolen goods, I take it they won't be sold/auctioned off anytime soon? Honestly with the US justice system being the absolute dumpster fire it is, I would be nervous as to how this is going to affect the Bitcoin price in the short term.

Also, what kind of amateurs can't keep 3.6 Billion to themselves? How did they even get caught? Should of Hodled it.

Yaunfitda

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^^ The timing of the news though, but it's hard to say if this is bullish or bearish, we will have to see in the next 24 hours.

In any case, it's good to see that those involved in the hack is caught and probably going back to jail to rot. I mean the two of them might be living lavishly with other peoples money. Hopefully they will spill where the rest of the bitcoin is.

bbc.reporter

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Quote from: TravelMug on February 08, 2022, 08:14:21 PM

Quote from: nullama on February 08, 2022, 07:47:28 PM

I would like to know two things:

How were the Bitfinex bitcoins stolen?

The Bitfinex hacked was in August 2016. The couple was not involved directly. But they are the one who laundered the stolen bitcoin through an elaborate scheme.

Quote

According to court documents, Lichtenstein and Morgan allegedly conspired to launder the proceeds of 119,754 bitcoin that were stolen from Bitfinex’s platform after a hacker breached Bitfinex’s systems and initiated more than 2,000 unauthorized transactions. Those unauthorized transactions sent the stolen bitcoin to a digital wallet under Lichtenstein’s control. Over the last five years, approximately 25,000 of those stolen bitcoin were transferred out of Lichtenstein’s wallet via a complicated money laundering process that ended with some of the stolen funds being deposited into financial accounts controlled by Lichtenstein and Morgan. The remainder of the stolen funds, comprising more than 94,000 bitcoin, remained in the wallet used to receive and store the illegal proceeds from the hack. After the execution of court-authorized search warrants of online accounts controlled by Lichtenstein and Morgan, special agents obtained access to files within an online account controlled by Lichtenstein. Those files contained the private keys required to access the digital wallet that directly received the funds stolen from Bitfinex, and allowed special agents to lawfully seize and recover more than 94,000 bitcoin that had been stolen from Bitfinex. The recovered bitcoin was valued at over $3.6 billion at the time of seizure.

Here is the official court document: https://www.justice.gov/opa/pr/two-arrested-alleged-conspiracy-launder-45-billion-stolen-cryptocurrency

What does everyone speculate the special agents will do to the 94,000 coins that have been recovered? Will they return those coins to Bitfinex or will they hold it for safety and security?

Also, what does everyone think of this news? Is it bullish or bearish? It appears that it might be argued for either side hehehe.

rhomelmabini

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Quote from: TravelMug on February 08, 2022, 08:14:21 PM

Here is the official court document: https://www.justice.gov/opa/pr/two-arrested-alleged-conspiracy-launder-45-billion-stolen-cryptocurrency

I wonder if those seized 94k total of bitcoins will be given to Bitfinex once again since the the special agents has already access on it? It was still an allegation but I think the investigation has huge ties that they are likely the launderers here and kudos to those who actively participate in this operation.

It's been 6 years but even if they have been silent over it, I think the investigation will still be alive to seize and pursue them.

Quote from: cabron on February 08, 2022, 09:33:42 PM

The DOJ didn't mention how they are connected to the hackers so this is still a classified doc?

I guess it is still classified but they'll be out I think when they get their sentence.

cabron

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Quote from: Kemarit on February 08, 2022, 08:44:28 PM

Quote from: crwth on February 08, 2022, 08:21:33 PM

So they are just in connections with the hackers and they are in charge of making the money clean and not traceable, right?

Yes, most likely this is the case here, we are not sure how they know the hackers, maybe the hackers contacted them or what. But it's clear that the DOJ has trace the trail of the stolen Bitfinex hacked and identify it to Ilya Lichtenstein and Heather Morgan.

And based on the images and their lifestyles, they are living big and obviously you have to question where all the wealth is coming.

Old police work I think. When there is a big heist and someone suddenly living a high life, arise suspicions. People around them sure wonder where they get thier money and if they think like they can buy just about anything and brags about it on social media being a croc on wall street, it's odd. Normally they are sheep and wolves. Grin

The DOJ didn't mention how they are connected to the hackers so this is still a classified doc? The term "Alleged" still makes them not guilty yet.

Kemarit

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Quote from: crwth on February 08, 2022, 08:21:33 PM

So they are just in connections with the hackers and they are in charge of making the money clean and not traceable, right?

Yes, most likely this is the case here, we are not sure how they know the hackers, maybe the hackers contacted them or what. But it's clear that the DOJ has trace the trail of the stolen Bitfinex hacked and identify it to Ilya Lichtenstein and Heather Morgan.

And based on the images and their lifestyles, they are living big and obviously you have to question where all the wealth is coming.

Darker45

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What's with the very large images? You can actually narrow them down by placing width=400 or 500 or whatever size is preferable to you right after [img. Like this, [img width=400]. Perhaps you preferred it this way, but it's a little irritating to the eyes, especially because you posted more than one.

Anyway, I should congratulate the law enforcers for finally seizing the stolen Bitcoin. Although not everything was recovered, at least around 80% has already been confiscated. That's a huge success.

And, unlucky and extremely foolish for both Lichtenstein and Morgan for keeping the private keys in an online account. Both of them are either stupid or too complacent to store online the keys to the wallet where the billions in Bitcoin was stored.

The authorities must be very close to the real culprit.

crwth

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So they are just in connections with the hackers and they are in charge of making the money clean and not traceable, right?

Damn, there is real stuff like this that would make you wonder what more there is in the world that is happening that we don't know of and they are just operating in the shadows.

TravelMug

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Quote from: nullama on February 08, 2022, 07:47:28 PM

I would like to know two things:

How were the Bitfinex bitcoins stolen?

The Bitfinex hacked was in August 2016. The couple was not involved directly. But they are the one who laundered the stolen bitcoin through an elaborate scheme.

Quote

According to court documents, Lichtenstein and Morgan allegedly conspired to launder the proceeds of 119,754 bitcoin that were stolen from Bitfinex’s platform after a hacker breached Bitfinex’s systems and initiated more than 2,000 unauthorized transactions. Those unauthorized transactions sent the stolen bitcoin to a digital wallet under Lichtenstein’s control. Over the last five years, approximately 25,000 of those stolen bitcoin were transferred out of Lichtenstein’s wallet via a complicated money laundering process that ended with some of the stolen funds being deposited into financial accounts controlled by Lichtenstein and Morgan. The remainder of the stolen funds, comprising more than 94,000 bitcoin, remained in the wallet used to receive and store the illegal proceeds from the hack. After the execution of court-authorized search warrants of online accounts controlled by Lichtenstein and Morgan, special agents obtained access to files within an online account controlled by Lichtenstein. Those files contained the private keys required to access the digital wallet that directly received the funds stolen from Bitfinex, and allowed special agents to lawfully seize and recover more than 94,000 bitcoin that had been stolen from Bitfinex. The recovered bitcoin was valued at over $3.6 billion at the time of seizure.

Here is the official court document: https://www.justice.gov/opa/pr/two-arrested-alleged-conspiracy-launder-45-billion-stolen-cryptocurrency

nullama

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I would like to know two things:

How were the Bitfinex bitcoins stolen?

How were the bitcoins seized?

arabspaceship123

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It's taken over 6 years for Ilya Lichtenstein 34 and Heather Morgan 31 to be arrested. When 119,754 bitcoins were stolen in 2016 from Bitfinex they were valued at $71m. They're worth over $4.5 billion today. DoJ said it's their largest financial seizure.

They've been using bitcoin ATMs to get cash to buying gold, NFTs and Walmart cards. When police were given search warrants they've found a private key holding 94,000 Bitcoins in one wallet.

They're facing 20 years in jail for money laundering plus 5 years for conspiracy to defraud the US.

She's calling herself Crocodile of Wall Street. Heather Morgan's instagram's @razzlekhan. She's using realrazzlekhan at TikTok because she's said it's like Gengiz Khan but with more pizzazz. She's rapping in TikTok videos realrazzlekhan

She's got her own website https://razzlekhan.com she's dancing and rapping. Her website's posted The infamous Crocodile of Wall Street strikes again! More fearless and more shameless than ever before, she's taking on everyone from big software companies to healthcare to finance bros.

She didn't behave the way other billionaires did now she's a criminal going to jail she'll be released when she's 55.

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