Heather Morgan, known as the Wall Street rapper “Razzlekhan,” faces a potential 18-month prison sentence for her involvement in laundering millions tied to the 2016 Bitfinex hack.
U.S. prosecutors are pushing for an 18-month prison term for Morgan following her guilty plea to a money-laundering conspiracy charge related to the theft of Bitcoin (BTC) during the 2016 Bitfinex hack.
In a court filing dated October 9, Morgan is noted to have provided “substantial assistance” to the government as part of her cooperation. Her husband, Ilya Lichtenstein, was responsible for orchestrating the theft of approximately 120,000 Bitcoin, valued at about $4.5 billion at the time, and prosecutors allege that Morgan aided in laundering the illicit funds. Although she was not involved in the hack itself, evidence suggests that she participated in hiding the illicit proceeds through various means, including purchasing non-fungible tokens, gold, and gift cards.
“She was in some ways thrust into the middle of a serious criminal scheme without her initial consent, and undoubtedly felt compelled to support it out of a sense of loyalty to her husband and desire to preserve their life together,” stated U.S. prosecutors.
The prosecution characterized the couple’s laundering efforts as “sophisticated,” detailing their use of complex transactions, non-compliant virtual currency exchanges, darknet markets, and mixers, such as Bitcoin Fog, Helix, and ChipMixer, to obscure the origins of the funds.
While facing significant charges, Morgan may benefit from a reduced sentence due to her cooperation, although she also faces a maximum of five years for conspiring to defraud the U.S. Meanwhile, her husband remains incarcerated, whereas Morgan has been placed under house arrest on a $3 million bail and is allowed to work as a web3 advisor.
