A lawyer for the self-proclaimed ‘Crocodile of Wall Street’, Heather Rhiannon Morgan, 31, and her husband Ilya ” Lichtenstein, 34, claim neither of them are ‘flight risks’ because Morgan has frozen embryos in the city.
The couple’s lawyer, Samson Enzer, has urged a judge to allow them to be freed on $3million and $4.5million bail respectively, saying the fact neither of them fled when given the chance upon first being alerted to the investigation, proves they would not run from the law if now freed on bail.
Prosecutors are urging caution: It is believed the couple still have vast sums of money at their disposal which is likely hidden from authorities.
Furthermore, Lichtenstein has dual citizenship with giving the couple a possible safe haven from which it would be particularly difficult for U.S. authorities to secure an extradition order should the couple choose to flee.
The pair, dubbed ‘Bitcoin Bonnie and Crypto Clyde’ by financial newsletter Morning Brew, were both arrested on Tuesday on federal charges of conspiracy to commit money laundering and conspiracy to defraud the United States for allegedly laundering $4.5billion in stolen in the 2016 Bitfinex exchange hack.
If convicted, they face up to a maximum of 25 years in prison.
A lawyer for the self-proclaimed ‘Crocodile of Wall Street’, Heather Rhiannon Morgan, 31, and her husband Ilya ‘ Dutch ‘ Lichtenstein, 34, right, has urged a judge to allow them to be freed on $3million and $4.5million bail respectively
Prosecutors argued that the pair, who live on Wall Street in Lower Manhattan, darknet site should be denied bail, calling them flight risks who still potentially have access to vast sums of money.
Lichtenstein, is a dual US-Russian national from Illinois, while Morgan hails from California.
The couple’s lawyer claims the couple want to start a family and would not run away from her fertilized eggs.
‘Morgan previously froze several of her embryos at a hospital in New York in anticipation of starting a family together, as she can only conceive through in vitro fertilization because she suffers from endometriosis,’ the couple’s lawyer Samson Enzer wrote in a filing.
In this courtroom sketch, attorney Sam Enzer, center, sits between Heather Morgan, left, and her husband, Ilya ‘Dutch’ Lichtenstein, in federal court on Tuesday
‘The couple would never flee from the country at the risk of losing access to their ability to have children, which they were discussing having this year until their lives were disrupted by their arrests in this case,’ Enzer explained.
Federal law enforcement officials said they have recovered roughly $3.6 billon in cryptocurrency – the Justice Department’s largest ever financial seizure – linked to the hack of Bitfinex, a virtual currency exchange based in Hong Kong, whose systems were breached nearly six years ago.
Enzer also attempted to explain how well behaved his clients had been since they were alerted of the investigation into them.
‘Both stayed put in their residence in lower Manhattan … even after the government’s investigation targeting them in this case’ several months ago.
The couple say they have no intention of fleeing because Morgan has frozen embryos stored in New York because the pair had intentions to start a family
The court filing comes just days before the couple’s next scheduled bail hearing in U.S. District Court in Washington, D.C., on Monday.
Judge Beryl Howell will then make a determination on what is best for the pair while they await trial.
On Thursday, Judge Howell ordered the pair to be brought to Washington for next week’s hearing.
Enzer pleaded with Judge Howell for her to stick with the agreements already made with Manhattan federal court Judge Debra Freeman.
Freeman had set bond at $5 million for Lichtenstein and $3 million for Morgan together with added conditions of home incarceration and location-monitoring devices.
But the bail ruling was ultimately blocked after Judge Freeman took notice of prosecutdark web link of convoluted blockchain-and cryptocurrency-tracing assertions,’ he added.
Enzer also stressed that the couple needed to be kept out of jail in order to prepare a defense for their trial and noted how Morgan suffers from various medical conditions including surgery to remove a lump in her breast and ‘pre-existing lung damage from a prior bout of Middle East Respiratory Syndrome, or MERS,’ which put her at increase risk for catching covid.
Bail for Ilya ‘Dutch’ Lichtenstein, 34, right, and his wife, Heather Rhiannon Morgan, 31, was set at $5million and $3million respectively after their arrest on Tuesday but they have not been released
Earlier this week, the Justice Department shared more information as to the progress with the investigation.
It revealed on Tuesday that more than $3.6 billion worth of bitcoin linked the 2016 hack has been seized having allegedly been in crypto wallets controlled by the couple.
When the breach occurred, 120,000 bitcoins were allegedly transferred into a crypto wallet that Lichtenstein still had access to last month.
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Heather Morgan, 31, who calls herself the ‘Crocodile of Wall Street’ (hence the croc pictured in her hand) also spends time creating low-budget rap videos and posing for quirky photoshoots
<img id="i-3b0a02b0d2966b86" website height="627" width="634" alt="" class=" and the United States and the co-founder of an online marketing firm. Morgan, a rapper and former Forbes contributor, describes herself as 'an expert in persuasion, social engineering, and game theory'.
The August 2016 Bitfinex hack itself was one of the largest crypto heists ever recorded – so massive that news of the theft knocked 20 percent off Bitcoin’s value at the time.
Lichtenstein and Morgan are thus far not charged directly with perpetrating the hack, but rather with receiving and laundering the stolen funds. The case was filed in a federal court in Washington, D.C.
The couple is accused of conspiring to launder 119,754 bitcoin that was stolen, after a hacker attacked Bitfinex and initiated more than 2,000 unauthorized transactions.
The couple is accused of conspiring to launder 119,754 bitcoin that was stolen, after a hacker attacked Bitfinex and initiated more than 2,000 unauthorized transactions’
The complaint alleges, the FBI and federal prosecutors were able to trace the movement of Bitcoin from this hack,’ said Matthew Graves, the U.S. Attorney for the District of Columbia.
He added that the money moved through a major darknet market exchange tied to a host of crimes, as well as cryptocurrency addresses tied to child sexual abuse materials.
Lichtenstein and dark markets 2023 Morgan are facing charges of conspiring to commit money laundering, as well as to defraud the United States.
Prosecutors said on Tuesday the illegal proceeds were spent on a variety of things, from gold and non-fungible tokens to ‘absolutely mundane things such as purchasing a Walmart gift card for $500.’
The August 2016 Bitfinex hack itself was one of the largest crypto heists ever recorded – so massive that news of the theft knocked 20 percent off Bitcoin’s value
Bitfinex said in a statement that it was to working with the Department of Justice to ‘establish our rights to a return of the stolen bitcoin.’
‘We have been cooperating extensively with the DOJ since its investigation began and will continue to do so,’ the company said.
Bitfinex said it intends to provide further updates on its efforts to obtain a return of the stolen bitcoin as and when those updates are available.
Tuesday’s criminal complaint came more than four months after Monaco announced the department was launching a new National Cryptocurrency Enforcement Team, which is comprised of a mix of anti-money laundering and cybersecurity experts.
Cyber criminals who attack companies, municipalities and individuals with ransomware often demand payment in the form of cryptocurrency.
In one high-profile example last year, hackers caused a widespread gas shortage on the U.S. East Coast when by using encryption software called DarkSide to launch a cyber attack on the Colonial Pipeline.
The Justice Department later recovered some $2.3 million in cryptocurrency ransom that Colonial paid to the hackers.
Cases like these demonstrate that the Justice Department ‘can follow money across the blockchain, just as we have always followed it within the traditional financial system,’ said Kenneth Polite, assistant attorney general of the department’s Criminal Division.
Morgan is seen rapping with the New York Stock Exchange behind her to the right
Justice Department officials say that though the proliferation of cryptocurrency and virtual currency exchanges represent innovation, the trend has also been accompanied by money laundering, ransomware and other crimes
‘Today´s arrests, dark web darknet market list and the Department’s largest financial seizure ever, show that cryptocurrency is not a safe haven for criminals,’ Deputy Attorney General Lisa Monaco said in a statement.
‘In a futile effort to maintain digital anonymity, the defendants laundered stolen funds through a labyrinth of cryptocurrency transactions. Thanks to the meticulous work of law enforcement, the department once again showed how it can and will follow the money, no matter the form it takes.’
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