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United States Department of Justice has unsealed It details the charges against the two men responsible for the $400 million hack of former bitcoin (BTC) exchange Mt Gox. According to the announcement, Alexey Bilyuchenko, 43, and Aleksandr Werner, 29, allegedly conspired to launder 647,000 BTC they stole from Mt Gox through a hack of the exchange’s servers.
Bilychenko is also accused of conspiring to operate the BTC-e exchange, which was shut down in 2017 on charges of money laundering.
The DOJ dropped charges related to the 2011 hack of cryptocurrency exchange Mt.Gox and the operation of illegal cryptocurrency exchange BTC-e.
Alexey Bilyuchenko, 43, and Aleksandr Werner, 29, both Russian citizens, have been charged with conspiracy to launder approximately …
— db (@tier10k) June 9, 2023
Prosecutors claim the hack occurred over a period of more than a year, from September 2011 to at least May 2014. During this time, the two men allegedly gained control of the Mt Gox servers located in Japan. He then periodically transferred BTC to himself from Mt Gox until the “vast majority” of customers’ BTC were pulled from the exchange.
After getting hold of these bitcoins, the men attempted to sell them through another exchange they controlled. To facilitate these sales, the two men allegedly entered into fraudulent contracts with a bitcoin brokerage firm based in New York. The brokerage firm bought the stolen BTC from the hackers by sending wire transfers to various offshore bank accounts. The bitcoins themselves were left in the possession of the hackers exchange, but were deposited into a brokerage firm’s account.
The announcement did not say whether BTC-e was the exchange used in the fraudulent transaction, instead referring to the exchange as “Exchange-1”. Prosecutors claim the pair received approximately $6.6 million from the deal.
Connected: Mt Gox Refund Registration Closed: Here’s What’s Next
Mt Gox was one of the first major cryptocurrency exchanges. It filed for bankruptcy in March 2014 after claiming that the hack pushed it into bankruptcy.
BTC-e operated from 2011 to 2017. In 2017, the FBI busted some of its cryptocurrencies, claiming to have earned money through money laundering. Alexander Vinnik, the founder of BTC-e, is currently serving a prison sentence for his association with the exchange. In May, Vinnik’s attorney attempted to have him released as part of a prisoner swap with the Russian Federation.
