A&D Forensics Brief, November 15, 2024
A&D Forensics
Financial and Blockchain Intelligence Consulting, Blockchain Forensics, Crypto Investigations and Training Firm.
Ilya Lichtenstein, mastermind of the 2016 Bitfinex hack stealing 119,000 Bitcoin, was sentenced to 60 months for money laundering. Authorities recovered $10 billion of stolen assets after a seven-year investigation involving U.S. agencies and blockchain forensics. Lichtenstein and his wife, Heather Morgan, laundered Bitcoin worth $4.5 billion using darknet markets and coin mixers.
The Economic and Financial Crimes Commission (EFCC) is urgently seeking a 300% increase in its annual budget to tackle the rising cases of financial crimes, including cybercrime and cryptocurrency fraud, which have caused significant losses in Nigeria. EFCC Chairman, Ola Olukoyede, emphasized the need for advanced software to monitor virtual currencies and combat fraudulent crypto trading.
The South Korean police arrested 215 people in a $232 million crypto investment scam that defrauded over 15,000 victims. The scheme, involving fake consulting firms and a YouTuber, promised high returns and encouraged people to sell assets and take loans. Twelve suspects remain in detention.
South Korea's Financial Intelligence Unit (FIU) has reportedly identified 500,000 to 600,000 potential KYC violations by major cryptocurrency exchange Upbit during its business license renewal review, including accepting IDs with blurred data.
The DeltaPrime protocol was exploited for $4.8 million in Arbitrum (ARB) and Avalanche (AVAX) tokens. The hack, which began when the exploiter contributed liquidity, led to the DeltaPrime team pausing the protocol on both blockchains. This incident adds to the increasing number of crypto hacks in 2024, following a $13.7 million hack of exchange M2 earlier in November.
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Daren Li, a Chinese dual citizen, pleaded guilty to laundering $73 million from crypto scams. He helped funnel stolen funds through shell companies and US bank accounts, converting them into Tether (USDT) and distributing them to controlled wallets. Over $341 million was laundered through the scheme.
Roman Sterlingov, the founder of Bitcoin Fog, a prominent cryptocurrency mixer on the darknet, was sentenced to 12.5 years in prison following his March conviction on charges of money laundering, conspiracy, and operating an unlicensed money-transmitting business. The U.S. Department of Justice (DOJ) described Bitcoin Fog as a favored service for criminals, facilitating the laundering of over 1.2 million Bitcoin, worth around $400 million at the time.
The U.S. Department of Justice (DOJ) has filed to seize $16 million in cryptocurrency from a Binance account, linked to a bribery scheme involving FTX founder Sam Bankman-Fried. In 2021, Bankman-Fried allegedly authorized a $40 million bribe in Tether (USDT) to Chinese officials to unfreeze $1 billion of Alameda Research’s crypto. The funds were funneled through private wallets, eventually landing in the targeted Binance account.
The European Banking Authority (EBA) released guidelines on Nov. 14 for Payment Service Providers (PSPs) and Crypto-Asset Service Providers (CASPs) to comply with EU sanctions in fund and crypto transfers. These rules aim to strengthen risk management and prevent circumvention of restrictive measures.