Lost money in the 2016 Bitfinex hack? Justice Department Says ‘No Victims’

The US Department of Justice (DOJ) has created a website to collect statements from people affected by the 2016 Bitfinex hack.

The initiative aims to provide potential victims with the opportunity to share how they may have been affected by the criminal behavior of Ilya Lichtenstein and his wife Heather Morgan. This initiative was announced in Press release from the Department of Justice, November 7..

Although the Department of Justice’s position is that there are no victims under the Crime Victims’ Rights Act (CVRA), the Department is providing this notice to the public to ensure that anyone who could potentially be harmed by the actions of the accused , can be heard. This includes affected Bitfinex account holders.

In August 2016, Ilya Lichtenstein infiltrated the Bitfinex cryptocurrency exchange, resulting in the theft of approximately 120,000 Bitcoin (BTC) and Bitcoin Cash (BCH). At the time the assets were stolen, they were worth approximately $72 million. But now the stolen bitcoin alone is worth about $9.2 billion.

Following the hack, Liechtenstein developed a complex scheme to launder stolen assets. This plan included multiple layers of transactions, the use of cryptocurrency mixers, interaction with incompatible exchanges, the use of darknet markets, and the transfer of funds through bank accounts both in the United States and abroad.

Heather Morgan assisted Liechtenstein in laundering illegal funds. The couple continued their activities until their arrest in February 2022. They were charged with conspiracy to commit money laundering and conspiracy to defraud the United States.

On August 3, 2023, Liechtenstein pleaded guilty to one count of conspiracy to commit money laundering. His sentencing is set for November 14, 2024, with the Department of Justice recommending a sentence in excess of five years. On the same day last August, Morgan pleaded guilty to one count of conspiracy to commit money laundering and one count of conspiracy to defraud the United States. Her sentencing is scheduled for November 15, 2024.

Report follows recent hack $20 million depletion from a US government cryptocurrency wallet containing assets seized in the Bitfinex hack, only to return most of the funds just a few days later. About $19.3 million of funds were returned, but some of the funds were transferred to exchanges and were not sent back.

Edited by Stacy Elliott.