Bitfinex hack
Rapper and her husband arrested: FBI finds $4 billion in Bitcoin
The US rapper Heather M. aka Razzlekhan and her husband have been arrested.
© https://www.instagram.com/razzlekhan/
In 2016, bitcoin exchange Bitfinex reported the theft of 120,000 bitcoins. Investigators have now confiscated more than 94,000 of them from a US rapper and her husband. A lone record in US criminal history.
The American judiciary reports a record: the authorities managed to confiscate 94,000 Bitcoin from a hack six years ago. The cryptocurrency is worth $4,076,592,000 at today’s price of $43,368 per coin. According to the police, the money came from the famous Bitfinex hack in 2016. At that time, unknown persons stole 120,000 Bitcoin.
The couple Heather Rhiannon M. and Ilya L. from New York are said to have spent the past few years laundering the gigantic sum. The pair are said to have made mistakes. Self-proclaimed rapper Heather M., who makes music under the name Razzlekhan, even jokingly admitted to the theft in a Tiktok video.
Blockchain hunt through the net
The work of the police would be material for a film if the investigation wasn’t so complicated and dry. At its core, the couple is said to have failed due to the principle of the blockchain on which Bitcoin transfers are recorded. Because the system is set up in such a way that not a single transaction is ever forgotten. Since the time of the theft, it has been possible to follow the money – for everyone.
According to the investigation documents, the couple is said to have tried to launder the money in a large number of transactions from 2017 onwards. However, apparently it was not possible to completely erase the traces that lead to the original loot. Although, according to the authorities, the spouses are said to have used a variety of creative concealment techniques. These include founding shell companies, buying gold, buying NFTs, switching to several alternative coins or buying gift vouchers with the coins.
Gold by delivery service
However, by watching the money, the FBI managed to spot patterns. The couple is said to have repeatedly used the same IP, as well as an Indian email provider. The couple redeemed the vouchers in their own names, and the gold was actually delivered to the real home address of the two.
The fact that the authorities had a search warrant for their online access was ultimately fatal to Ilya L. and his wife. The agents got hold of a file in which L. had stored access for his Bitcoin exchanges and false identities used. This list also included the so-called wallet, in which the stolen bitcoin had been stored since 2016. Over 94,000 coins were still there and immediately went into the possession of the American judicial authorities.
The Justice Department is taking the news of the record seizure as an opportunity to warn that it will not “allow cryptocurrencies to be a safe haven for money laundering or a zone of lawlessness within the American financial system.”
There is a risk of 25 years imprisonment
The charges are currently limited to conspiracy to launder money, which carries up to 20 years in prison, and conspiracy to defraud the United States, which carries up to five years in prison. The presumption of innocence applies to both of them until the verdict.
The social media accounts of Heather M., who presents herself on various platforms under the pseudonym Razzlekhan, received a lot of attention after the allegations became known. M. describes herself as a surrealist artist, some of her music videos can be found on YouTube.
Hope for lost coins
The American judiciary would like to enable victims who were affected by the theft of Bitcoin from Bitfinex in 2016 to claim the stolen goods through court proceedings. Appropriate evidence is mandatory.