A New York resident accused of being behind the 2016 hack that led to a loss of Bitcoins worth USD $4.5 billion on Bitfinex pleaded guilty today (Thursday). Ilya Lichtenstein also pleaded guilty to laundering the stolen Bitcoins in a federal court in Washington, D.C.

According to a report by CNBC, Lichtenstein took the plea before his wife, Heather Rhiannon Morgan, who was among the audience in the courtroom. Lichtenstein and Morgan were arrested last year for allegedly laundering cryptocurrencies worth USD $4.5 billion stolen from Bitfinex in 2016.

Lichtenstein to Remain in Custody

Lichtenstein, originally from Russia, has been under police custody since his arrest. His wife and accomplice Morgan, an aspiring rapper also known as ‘Razzlekahn’ or ‘The Crocodile of Wall Street’, was freed on a USD $3 million bond after her arrest.

Two weeks ago, Finance Magnates reported that the couple will appear before Senior Judge Colleen Kollar-Kotelley in Washington, D.C. for a plea hearing for charges related to conspiracy to commit money laundering Money Laundering Money laundering is a blanket term to describe the process by which criminals disguise the original ownership and proceeds of criminal conduct by making such proceeds appear to be derived from a legitimate source.Money laundering is an issue that traverses countless industries and sectors, which includes the financial services space. Though criminal money may be successfully laundered without the assistance of the financial sector, billions of dollars’ worth of criminally derived money are laund Money laundering is a blanket term to describe the process by which criminals disguise the original ownership and proceeds of criminal conduct by making such proceeds appear to be derived from a legitimate source.Money laundering is an issue that traverses countless industries and sectors, which includes the financial services space. Though criminal money may be successfully laundered without the assistance of the financial sector, billions of dollars’ worth of criminally derived money are laund Read this Term and defraud the United States.

According to the officials from the U.S. Department of Justice, Lichtenstein conspired with Morgan to launder 119,754 Bitcoins worth an estimated USD $70 million, at the time Bitfinex was hacked. When the duo was arrested, the DOJ seized 94,000 Bitcoins worth USD $3.6 billion, the largest seizure in the Department’s history.

Complex Money Laundering Scheme

Earlier, the DOJ explained that about 25,000 of the stolen Bitcoins were moved from Lichtenstein’s digital wallet Digital Wallet A digital wallet is a popular mechanism referring to an electronic device, online service, or software program that allows one party to make electronic transactions with another party.This involves the bartering or exchange of digital currency, including cryptocurrency for goods and services. Money can be deposited in the digital wallet prior to any transaction, which also includes an individual's bank account that is linked to the digital wallet. A digital wallet can include more than just digi A digital wallet is a popular mechanism referring to an electronic device, online service, or software program that allows one party to make electronic transactions with another party.This involves the bartering or exchange of digital currency, including cryptocurrency for goods and services. Money can be deposited in the digital wallet prior to any transaction, which also includes an individual's bank account that is linked to the digital wallet. A digital wallet can include more than just digi Read this Term in a complicated money laundering process that ended with some of the tokens being deposited in the couple’s accounts.

During the plea hearing, it was discovered that Lichtenstein had converted some of the allegedly stolen Bitcoins to gold, which Morgan had buried in a location now known to law enforcement agencies. Additionally, it was revealed that Lichtenstein traveled to Ukraine and Kazakhstan to launder the stolen funds.

Meanwhile, in May, a global network of investigative journalists claimed that Bitfinex never made the report public, alleging that the exchange experienced security lapses that led to the hack. However, Bitfinex dismissed the Organized Crime and Corruption Reporting Project’s (OCCRP) findings.