US prosecutors have requested an 18-month prison sentence for Heather Morgan for her role in laundering 119,754 BTC stolen from the Bitfinex exchange in 2016.
In 2022, law enforcement arrested the couple involved in the hack—34-year-old Ilya Lichtenstein and 31-year-old Morgan. They seized over 94,000 BTC valued at $3.6 billion at the time.
The couple was accused of conspiring to launder proceeds. Authorities claim Lichtenstein was directly involved in the attack on the platform, though he denied this.
On August 3, 2023, the husband and wife pleaded guilty to a single count related to money laundering. Lichtenstein faces up to 20 years in prison, while Morgan could receive a maximum sentence of 10 years. Sentencing is scheduled for November 14 and 15, 2024, respectively.
The prosecution justified the significant reduction in Morgan’s sentence due to her “substantial assistance” in the plea deal. She was less involved in the crimes than her husband and spent only a “small portion” of the stolen funds.
In February 2022, the court released Morgan on $3 million bail. She was later seen at several crypto conferences, where the community suspected her of gathering information for the government.
Prosecutors also noted that Morgan initially did not know how Lichtenstein acquired the bitcoins. However, by early 2020, he confessed to his responsibility for the hack, and she began assisting him.
“This was not a momentary lapse or impulsive decision: the defendant knowingly participated in a money laundering conspiracy and fraud conspiracy for many years,” the statement reads.
According to law enforcement, Morgan and Lichtenstein used “various technologically sophisticated methods” to obscure their tracks, including using cryptocurrency exchanges without KYC procedures, darknet markets, and mixers.
Part of the stolen funds was used by Morgan to purchase gold coins, which she buried in a “secret location.” Authorities later uncovered their whereabouts.
In addition to the 18-month sentence, prosecutors asked the court to confiscate previously seized cryptocurrency assets and property from the couple, totaling $7.6 billion, to pay restitution to Bitfinex.
In October, prosecutors identified the exchange as the sole claimant for compensation from the hack but acknowledged there could be other potential victims.