United States prosecutors are pushing for the man who admitted to stealing 120,000 Bitcoin from crypto exchange Bitfinex in 2016 to serve only five years behind bars.
In an Oct. 15 filing, prosecutors told a Washington, DC Federal Court that Ilya Lichtenstein should serve less than the 20 years he initially faced after pleading guilty to one count of conspiracy to commit money laundering.
They argued that a lighter sentence was warranted because he has no prior criminal history and has given “substantial assistance” that has “benefitted numerous investigations.”
An excerpt from the prosecutor’s sentencing memorandum shows part of the reasoning behind the recommendation for a reduced prison sentence for Lichtenstein. Source: Pacer
Earlier this month, prosecutors also asked the court to reduce the sentence for Lichtenstein’s accomplice and wife, Heather Morgan, to 18 months in jail for her role in laundering the stolen crypto — due to her cooperation.
Prosecutors said Lichtenstein deserves a lighter sentence because he laundered only 25,111 Bitcoin (BTC) out of a possible 120,000, worth $71 million at the time, and attempts to delete incriminating data “did not ultimately hinder the investigation.”
Still, they requested a longer sentence than Morgan’s because Lichtenstein spent months devising the scheme and experimented with other hacking and financial fraud activities, such as stealing $200,000 from another crypto exchange.
The more substantial sentence is necessary to prevent future crimes and “reflect the seriousness of the offense,” prosecutors said.
“While the defendants have certainly cooperated with the government in recovering the residue of the stolen funds following their arrests, it was law enforcement intervention — not any sort of spontaneous remorse on the part of the defendants — that has facilitated those recoveries,” they said.
Lichtenstein’s conduct represents a new wave of young cybercriminals, and normalizing such online activities might underplay victims’ suffering, prosecutors added.
Related: Bitfinex hacker Heather Morgan spotted at Bitcoin Conference 2024
Prosecutors are also asking the court to order both defendants to return the crypto assets seized by the government from Lichtenstein’s wallet as in-kind restitution to Bitfinex.
The wallet contains about 95,000 Bitcoin, 117,400 Bitcoin Cash (BCH), 117,400 Bitcoin Satoshi Vision (BSV) and 118,100 Bitcoin Gold (BTG), currently worth a total of more than $6 billion.
Lichtenstein and Morgan were initially suspected only of laundering the hack’s proceeds, but Lichtenstein later admitted to being the hacker.
Lichtenstein’s sentencing is scheduled for Nov. 14, while his wife will be sentenced on Nov. 15.
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