Key points to remember
- The US DOJ has charged two Russian nationals for their connection to the 2011 Mt. Gox hack.
- Both suspects will be charged with conspiracy to commit money laundering in the Southern District of New York.
- A suspect is charged with conspiracy to launder money and operate an unlicensed money services business in the Northern District of California.
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Alexey Bilyuchenko, 43, and Aleksandr Verner, 29, both Russian nationals, were accused by the US Department of Justice in connection with the 2011 hack of major cryptocurrency exchange Mt. Gox and the illicit operation of another crypto exchange called BTC-e.
The 2011 heist led to the eventual insolvency of Mt. Gox in 2014.
Charges brought by the Southern District of New York include conspiracy to commit money laundering against the two defendants, while the Northern District of California also charged Bilyuchenko with conspiracy to launder money and exploit of an unlicensed money service. business.
These charges reveal a complex years-long operation that spanned multiple continents and involved the theft and laundering of approximately 647,000 BTC to Mt. Gox users. U.S. Attorney Ismail J. Ramsey for the Northern District of California said in the press release:
“For years, Bilyuchenko and his accomplices allegedly operated a digital currency exchange that enabled criminals around the world – including hackers, ransomware actors, narcotics rings and corrupt officials – to launder billions of dollars.”
The indictment alleges that Bilyuchenko and Verner executed a major hack against Mt. Gox, the largest bitcoin exchange at the time, in September 2011. Using their unauthorized access, they allowed “the transfer of bitcoin from Mt. Gox wallets to bitcoin addresses controlled by Bilyuchenko, Verner and their co-conspirators. They allegedly laundered more BTC through two other online exchanges in addition to Mt. Gox’s 647,000 BTC, according to the DOJ.
Posing as advertising service providers for a Bitcoin brokerage service in New York, the couple allegedly convinced the broker to transfer more than $6.6 million to offshore accounts under their control from March 2012 to April 2013. Back, the broker received a “credit” on an exchange, which was used to launder over 300,000 stolen BTC:
“The fraudulent advertising contract with the New York Bitcoin Broker allegedly allowed Bilyuchenko, Verner and their co-conspirators to conceal and liquidate stolen bitcoins via the Mt. Gox Hack.”
Bilyuchenko has been accused of joining forces with Alexander Vinnik, a Russian cryptocurrency ‘money launderer’ sentenced by the DOJ in 2022, to operate the infamous BTC-e virtual currency exchange from 2011 until it was shut down by law enforcement in 2017. The indictment claims that BTC-e was one of the largest cryptocurrency exchanges in the world, allegedly used as a laundering tool for cyber criminals around the world.