US regulators want Heather Morgan, hacker aka rapper “Razzlekhan,” to spend 18 months in prison for her role in laundering 120,000 Bitcoin stolen from the crypto exchange Bitfinex in 2016.
Federal lawmakers asked for a lenient sentence for Morgan in a filing because she provided substantial assistance in her and her husband Ilya Lichtenstein’s plea negotiation in July 2023.
Fed prosecutors also argued that Morgan was a “lower-level participant” at offense level 14 relative to Lichtenstein and she had only spent a small part of the stolen amount.
Morgan pled guilty to money laundering and fraud charges in August 2023 for helping launder the Bitcoin currently worth $7.2 billion. She faces a maximum combined sentence of 10 years in prison.
Apart from this, regulators have asked that the court order her to return the crypto assets seized by the government from the “Bitfinex Hack Wallet” which has nearly 95,000 BTC, 117,400 Bitcoin Cash (BCH), 117,400 Bitcoin Satoshi Vision (BSV), and 118,100 Bitcoin Gold (BTG) and is worth more than $6 billion. The payback must be done as an equivalent compensation to Bitfinex, said regulators.
Morgan’s sentencing hearing is scheduled for Nov. 15, after Lichtenstein who is set to be sentenced on Nov. 14.
It was initially understood that both Morgan and Lichtenstein were responsible for laundering the funds stolen in the 2016 Bitfinex hack. But Lichtenstein later admitted to being solely behind the hack and pleaded guilty to money laundering charges, as a result of which, he faces a maximum sentence of 20 years in prison.
Government prosecutors said that Morgan was “initially unaware” of how Lichtenstein had hacked 120k BTC, but by early 2020, Lichtenstein confessed to her that he was behind the hack, and she helped him in laundering the funds and conspired to hide his actions.
Also Read: Bitfinex Declared Sole Victim in 2016 Hack; $7.4B Recovery Efforts