Russian nationals charged with laundering stolen Bitcoins worth Rs 3,297 crore at the time

Two Russian nationals have been charged by the United States federal government in connection with the notorious hacking incidents that led to the collapse of the Mt. Gox Bitcoin exchange in 2014. The Department of Justice announced in a press release on Friday that it has unsealed a 2019 indictment, charging Alexey Bilyuchenko and Aleksandr Verner with conspiring to launder 6,47,000 Bitcoins stolen from the exchange, which had an approximate value of $400 million (Rs 3,297 crore) at the time.

In addition to the charges related to the Mt. Gox hack, the government has also separately charged Bilyuchenko for his involvement with Alexander Vinnik, who was indicted by the DOJ in 2017 and subsequently extradited to the US in late 2022. The charges against Bilyuchenko relate to their operation of BTC-e, a now-defunct cryptocurrency exchange that served as a prominent hub for cybercriminals to transfer, launder, and store the proceeds of their illegal activities.

During Vinnik's indictment, it was alleged by the government that funds stolen from Mt. Gox had flowed through BTC-e and wallets associated with Vinnik. The Department of Justice now asserts that Bilyuchenko, Verner, and other co-conspirators were involved in the laundering of over 300,000 Bitcoins that were stolen from Mt. Gox.

Mark Karpeles, the owner and CEO of Mt. Gox, was arrested in 2015 and faced charges of embezzlement and aggravated breach of trust in Japan. However, in 2019, Karpeles was acquitted on most of the charges, receiving a suspended sentence only for falsifying data. Recently, he retweeted a post that shared a link to the unsealed indictment.

Assistant Attorney General Kenneth A. Polite, Jr., stated in a release, "As alleged in the indictments, starting in 2011, Bilyuchenko and Verner stole a massive amount of cryptocurrency from Mt. Gox, contributing to the exchange's ultimate insolvency. Armed with the ill-gotten gains from Mt. Gox, Bilyuchenko allegedly went on to help set up the notorious BTC-e virtual currency exchange, which laundered funds for cybercriminals worldwide."

The charges against Bilyuchenko include conspiracy to commit money laundering and operating an unlicensed money services business, carrying a potential sentence of over 20 years in prison. Verner, on the other hand, is charged with conspiracy to commit money laundering, which carries a maximum penalty of 20 years behind bars.

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