Woman Faces 18-Month Sentence for Role in Massive Bitfinex Bitcoin Laundering Scheme

Heather Morgan, also known as the rapper "Razzlekhan," is facing an 18-month jail term as U.S. prosecutors pursue charges related to her involvement in laundering 120,000 BTC.

In a filing from October 9, authorities have recommended a lighter sentence, highlighting her cooperation during her and her husband Ilya Lichtenshtein’s plea bargain made in July 2023. They emphasized her role as a minor participant compared to Lichtenshtein and noted she had spent only a fraction of the stolen Bitcoin.

Morgan admitted guilt to money laundering and fraud in August 2023, with the Bitcoin now valued at approximately $7.2 billion. She could face up to 10 years in prison for her actions.

While initially thought to only assist in laundering, Lichtenshtein later confessed to being the mastermind behind the hack and has pled guilty to related charges, facing a potential 20-year sentence.

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Prosecutors indicated that Morgan was initially unaware of how Lichtenshtein acquired the Bitcoin, but by 2020, he had disclosed his involvement in the crime, and she actively helped him launder the stolen funds. They characterized her actions as deliberate criminal behavior carried out over several years.

In addition to the prison sentence, prosecutors are seeking restitution from Morgan, requiring her to return assets seized from the “Bitfinex Hack Wallet,” which contains around 95,000 Bitcoin and other cryptocurrencies worth over $6 billion.

Alexander Zdravkov