Heather Morgan Seeks Sentence Served in Bitfinex Bitcoin Laundering Case

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Ruholamin Haqshanas

Author

Ruholamin Haqshanas

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Ruholamin Haqshanas is a contributing crypto writer for CryptoNews. He is a crypto and finance journalist with over four years of experience. Ruholamin has been featured in several high-profile crypto…

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Last updated:

November 4, 2024 00:12 EST

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Heather Morgan, also known by her rapper alias “Razzlekhan,” is requesting to avoid further prison time as she awaits sentencing for her involvement in laundering Bitcoin stolen from the crypto exchange Bitfinex by her husband, Ilya Lichtenstein.

Morgan’s legal team filed an appeal on October 31 in a Washington, D.C. federal court, urging the judge to consider a sentence of “time served.”

Morgan’s attorneys pointed out that she endured challenging conditions during her brief pretrial detention, including recovery from surgery and contracting COVID-19.

Morgan Adhered to Her Pretrial Supervision Terms

Following her release in February 2022, they claim Morgan has fully adhered to the strict terms of her pretrial supervision.

In August 2023, she pleaded guilty to charges of money laundering and fraud related to the laundering of 120,000 Bitcoin, valued at approximately $8.2 billion, stolen from Bitfinex.

These charges carry a potential maximum sentence of 10 years in prison.

In recent developments, U.S. prosecutors have recommended a comparatively light sentence of 18 months for Morgan, citing her “substantial assistance” to the investigation.

Prosecutors also acknowledged that her role was minor relative to Lichtenstein’s and that she only accessed a fraction of the stolen funds.

According to their statement, Morgan was “thrust into the middle of a serious criminal scheme without her initial consent,” suggesting that her participation was likely motivated by loyalty to her husband.

Morgan’s legal counsel argued that she was unaware of her husband’s involvement in the Bitfinex hack until more than three years after the crime.

They maintain that Morgan “did not plan or seek out the offense” and express her “deep remorse” for her actions.

Her lawyers also said that she has taken steps to distance herself from her rap persona, Razzlekhan.

Her legal team described the Razzlekhan persona as a “caricature” distinct from her true character, noting Morgan’s growth and maturity.

The plea deal detailed that Lichtenstein admitted to stealing the 120,000 Bitcoin and enlisting Morgan to help conceal the funds.

He reportedly moved around 25,000 Bitcoin through crypto mixers and privacy services in an attempt to cover his tracks.

Prosecutors Ask Five-Year Sentence for Lichtenstein

Last month, U.S. prosecutors recommended a five-year sentence for Lichtenstein, reduced from a potential 20 years due to his cooperation, which they stated has been valuable to ongoing investigations.

Prosecutors argue, however, that Lichtenstein should face a longer sentence than Morgan, given his central role in the heist and his previous experimentation with a separate $200,000 crypto theft.

Morgan’s sentencing is set for November 15, with Lichtenstein’s hearing scheduled a day earlier on November 14.

Amazon’s production arm is currently in the works to produce a film titled “Razzlekhan,” inspired by the couple’s actions.

The screenplay is influenced by a 2022 New York Times article that outlined the duo’s involvement in laundering proceeds from the Bitfinex hack.