The Department of Justice on Friday unsealed charges against two Russian nationals accused of participating in a 2011 hack of cryptocurrency exchange Mt. Gox.
Authorities said the two Russians, Alexey Bilyuchenko and Aleksandr Verner, were charged with conspiring to launder about 647,000 bitcoins from the Mt. Gox hack. Bilyuchenko is also charged with conspiring with another co-conspirator in operating BTC-e, an illicit cryptocurrency exchange that was shut down by U.S. law enforcement in 2017.
“For years, Bilyuchenko and his co-conspirators allegedly operated a digital currency exchange that enabled criminals around the world — including computer hackers, ransomware actors, narcotics rings, and corrupt public officials — to launder billions of dollars,” said Ismail J. Ramsey, U.S. attorney for the Northern District of California.
In one of the indictments brought by the Southern District of New York, the defendants allegedly gained unauthorized access to a server holding crypto wallets of Mt. Gox, so they could illegally transfer digital assets to bitcoin addresses they controlled.
Mt. Gox ultimately shut down its operations in 2014 after the heist was uncovered.
“When cybercriminals engage in fraudulent activity, such as hacking and illicitly operating cryptocurrency exchanges, it is critical that we impose cost on the bad actors and ensure they face justice,” said Bryan Vorndran, assistant director of the FBI’s Cyber Division.
In a second indictment brought by the Northern District of California, Bilyuchenko is alleged to have operated with his co-conspirators the BTC-e exchange. At the time, BTC-e was one of the world’s largest crypto exchanges and “one of the primary ways by which cyber criminals around the world transferred, laundered, and stored the criminal proceeds of their illegal activities.”
“Cryptocurrency offers a new way for criminals to steal and launder money, but greed and deceit are nothing new,” said Jim Lee, chief of the IRS Criminal Investigation unit.
The indictments follow the DOJ’s recent takedown of a darknet cryptocurrency mixer, which allowed cybercriminals to launder more than $3 million of digital assets.
The agency said it seized two domains that directed users to the mixing service.