The US Department of Justice has unsealed charges against Russian nationals Alexey Bilyuchenko and Aleksandr Verner for allegedly stealing thousands of bitcoins from the Mt. Gox crypto exchange between 2011 and 2014. The two individuals were charged in the Southern District of New York “with conspiring to launder approximately 647,000 bitcoins,” which the department claimed was the majority of the bitcoins belonging to Mt. Gox customers. Bilyuchenko, 43, and Verner, 29, are accused of using their unauthorized access to Mt. Gox’s server to fraudulently transfer bitcoins from Mt. Gox’s wallets to bitcoin addresses controlled by them and their associates.
Stolen Bitcoin Laundered Through Accounts Under Their Names
The Justice Department has said that the defendants laundered a large portion of the stolen bitcoins through addresses associated with accounts under their names. The department has alleged that the defendants gained unauthorized access to a server used by Mt. Gox to house cryptocurrency wallets. Mt. Gox was the largest bitcoin exchange at the time, and the defendants used their unauthorized access to steal most of the bitcoins held by Mt. Gox customers. FBI Assistant Director in Charge Michael J. Driscoll said in a statement, “As alleged in the indictment, the defendants gained unauthorized access to a server used by Mt. Gox to house cryptocurrency wallets. Mt. Gox was the world’s largest bitcoin exchange at the time, and the defendants used their unauthorized access to steal the bulk of the bitcoins held by Mt. Gox customers.”
Connection to BTC-e Exchange
Bilyuchenko is also accused of working with Alexander Vinnik and others to operate the BTC-e exchange from 2011 until law enforcement shut it down in July 2017. BTC-e was a crypto trading platform that allowed users to trade bitcoin anonymously. The Justice Department has claimed that Bilyuchenko went on to help set up the notorious BTC-e virtual currency exchange with the ill-gotten gains from Mt. Gox, which laundered funds for cybercriminals worldwide. The department has described this announcement as an essential milestone in two significant cryptocurrency investigations.
Possible Consequences of Conviction
If convicted on the conspiracy to commit money laundering charges, Bilyuchenko and Verner could face up to 20 years in prison. The Justice Department’s Assistant Attorney General, Kenneth A. Polite, Jr., said in a statement on Friday, “This announcement marks an important milestone in two major cryptocurrency investigations. As alleged in the indictments, starting in 2011, Bilyuchenko and Verner stole a massive amount of cryptocurrency from Mt. Gox, contributing to the exchange’s ultimate insolvency. Armed with the ill-gotten gains from Mt. Gox, Bilyuchenko allegedly went on to help set up the notorious BTC-e virtual currency exchange, which laundered funds for cybercriminals worldwide.”