YouTube rapper Razzlekhan was involved in an elaborate scheme to launder the assets her husband stole from Bitfinex. Prosecutors seek an 18-month prison stint for her wrongs.
Heather ‘Razzlekhan’ Morgan, mocked in online communities for her music and a self-purported ‘shameless’ rapper, according to her YouTube bio, has been at the center of legal proceedings surrounding the 2016 Bitfinex hack. Federal prosecutors recommended the court that she serve an 18-month prison stint as she has been highly cooperative and only spent a “fraction” of the assets Bitfinex lost in 2016.
According to an October 9 court document, prosecutors asked the court to give her a lenient sentence thanks to her, stating, “The defendant has not only taken responsibility for her criminal conduct by pleading guilty, but she has also provided substantial assistance to law enforcement.” Moreover, they called her a “low-level participant” in the hack. However, she faces up to 10 years in prison.
The case revolves around Morgan and her husband, Ilya Lichtenstein, as the latter hacked Bitfinex to walk away with 120,000 bitcoin worth over $7 billion today. She was accused of laundering money and fraud charges in August last year, to which she pleaded guilty. While prosecutors believed Morgan and Lichtenstein were only involved in laundering the funds, the husband later admitted to stealing the funds. He faces a maximum sentence of 20 years behind bars. They were arrested in 2022.
Morgan was initially unaware of her husband’s role in the hack, only finding out in 2020 that he secured 120,000 bitcoin from the illicit pursuit. She then helped him launder the stolen assets and hopefully get away scot-free.
“And it was not a momentary lapse or impulsive decision: the defendant consciously participated in the money laundering conspiracy and conspiracy to defraud over the course of years,” the court filing read. “The massive scale, extraordinary sophistication, and continuous and deliberate nature of the defendants’ criminal actions weigh in favor of a strong sentence.”
Furthermore, the prosecutors asked the court to order Morgan to repay the assets held in the wallet seized by the government, holding the stolen funds. That would act as monetary restitution to Bitfinex.
Morgan and Lichenstein Used Technology to Cover Their Tracks
The couple utilized several measures to try to obfuscate Lichenstein’s tracks, including turning to the technological route cybercriminals often take, including darknet marketplaces, exchanges, and crypto mixers. Morgan used some of the stolen funds to buy gold and bury it at a secret location, which she has disclosed to the authorities.
Morgan’s sentencing is scheduled for November 15, a day after Lichenstein.
