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Husband in $3.6 Billion Bitcoin Case Held Whereas Spouse Will get Bond

By , in Politics , at February 15, 2022

A decide appeared extra involved by the flight danger posed by Ilya Lichtenstein than by his spouse, Heather Morgan, in a case accusing them of a sweeping scheme to launder stolen cryptocurrency.

WASHINGTON — A federal decide on Monday ordered the pretrial detention of a person charged with overseeing a sweeping scheme to launder billions of dollars of stolen Bitcoin whereas upholding a call by a New York decide to launch his spouse pending trial.

Chief Choose Beryl A. Howell of the Federal District Courtroom within the District of Columbia mentioned Ilya Lichtenstein, 34, a Russian émigré and tech investor, appeared to have vital motivation to flee, and might need sources to take action that investigators had neglected. However she dominated that his spouse, Heather Morgan, 31, an entrepreneur and a self-styled rapper often called Razzlekhan, met the standards for supervised launch.

Mr. Lichtenstein and Ms. Morgan had been arrested and accused of a scheme to launder the 119,754 Bitcoin stolen in a 2016 hack of Bitfinex, a cryptocurrency change based mostly in Hong Kong, putting them on the middle of a global financial mystery.

Investigators informed the decide that that they had discovered no proof the couple was concerned within the theft, however they offered a sprawling community of accounts via which they mentioned the pair was working to launder the funds.

The confiscation of the Bitcoin that remained in Mr. Lichtenstein’s pockets on Feb. 1, value roughly $3.6 billion on the time, was the Justice Division’s largest monetary seizure ever, officers have mentioned. The case has been seen as a watershed within the regulation and maybe investigation of the murky and sometimes illicit world of cryptocurrency.

In reviewing the case towards the couple, Choose Howell appeared to conclude that Mr. Lichtenstein was more proficient in the kind of monetary sleight of hand wanted to launder the stolen funds and probably safe a future for the pair exterior the USA. Given what she described as a familiarity with false identities and talent at shifting monetary belongings discreetly, Choose Howell expressed concern that Mr. Lichtenstein was a flight danger.

A lawyer representing the couple denied that that they had ever deliberate to flee, citing their household ties in the USA, in addition to the truth that that they had embryos frozen in New York in hopes of conceiving a baby, and that that they had not tried to go away the nation even after indications that they have been beneath investigation final yr.

However a prosecutor confused that whereas the federal government had secured the majority of the stolen funds, the couple had been recorded shifting stolen cash between varied cryptocurrencies and had the expertise with encrypted accounts essential to duck investigators in shifting belongings abroad.

Choose Howell expressed concern that Mr. Lichtenstein and Ms. Morgan have been being represented by the identical lawyer, particularly as she appeared to conclude that Mr. Lichtenstein’s involvement and planning far outweighed that of Ms. Morgan.

Though she mentioned the severity of the fees had elevated the motivation to flee “exponentially,” she left intact a earlier decide’s ruling that Ms. Morgan be launched on $Three million bond, posting her mother and father’ residence as collateral.

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