Who is Heather Morgan? 'Crocodile of Wall Street' arrested for laundering $4.5B in crypto
The 'crocodile of Wall Street' and husband were arrested and charged in the DoJ's largest-ever financial seizure over the 2016 Bitfinex hack
Rapper and tech entrepreneur Heather Rhiannon Morgan also known as the 'Crocodile of Wall Street' and her husband Ilya Lichtenstein were arrested and charged by the Department of Justice on February 8, 2022. The couple has been slapped with money laundering charges over the 2016 Bitfinex hack, from which they reportedly gained $3.6 billion in stolen cryptocurrency. The arrest is reportedly the DoJ's largest-ever financial seizure in its history.
As the popularity of crypto has soared over the past decade, numerous fraud cases have also come to the fore. In March 2021, John McAfee was famously charged with securities fraud over a crypto scheme, but the case never proceeded against him after he allegedly died by suicide while in a Spanish jail. Over the past year, 'memecoins' have also become something of a target for fraudsters, as US regulators struggle to grapple with crypto's booming popularity.
The worry is greater after many recent hacks, including the famous Colonial Pipeline hack, led to hackers demanding ransom in crypto. Back in 2016, the famous Bitfinex hack knocked off 20% of Bitcoin's value, To date, the hackers were never arrested, but the DoJ has managed to make some progress on the case with the arrest of Morgan and Lichtenstein.
Who is Heather Morgan?
"I'm many things, a rapper, an economist, a journalist, a writer, a CEO, and a dirty, dirty, dirty dirty h-e," Morgan rapped in a 2019 single. A look at her digital history, reveals that to be mostly accurate. Between 2017 and 2021, Morgan was a contributor to Forbes. Her bio on the website says she's "an expert in persuasion, social engineering, and game theory." She also spent six years writing for Inc. Magazine, and less than a year as an economist for The World Bank, according to her LinkedIn profile.
Morgan is an alumnus of UC Davis and the American University of Cairo with degrees in economics. However, she's also stepped beyond the field to become a rapper known as Razzlekhan. She's released three singles, most famously the 2019 single Versace Bedouin. The hustle made her a popular celebrity on Instagram, TikTok, and Twitter. When she's not busy living the high life, Morgan also works as SalesFolk and DemandPath, enterprises focused on B2B sales. She also co-founded Endpass, a firm that uses AI to detect fraud.
In 2021, Morgan married Lichtenstein, who is a citizen of both Russia and the US. The couple has since been living on Wall Street, where it appears they had another major side hustle going on - laundering cryptocurrency.
Arrest and charges in fraud case
The DoJ has slapped the couple on charges of conspiracy to commit money laundering and conspiracy to defraud the United States. While the duo is not believed to have been responsible for the hack, it is reported that they received the stolen cash and laundered it. At the time of the hack, the money stolen was valued at $71 million and has now shot up to $4.5 billion.
The 20-page statement of facts filed by the DoJ indicates that the couple used the stolen cash to buy items ranging from gold to non-fungible tokens and even a $500 Walmart gift card. They did so by moving the money around through dozens of accounts linked to them, and Morgan's firm SalesFolk. They were presented at Manhattan Federal Court on February 8, where bond was set at $5 million for Lichtenstein and $3 million for Morgan.
In a statement, Deputy Attorney General Lisa Monaco declared, "Today´s arrests, and the Department´s largest financial seizure ever, show that cryptocurrency is not a safe haven for criminals." The couple will be placed under house arrest and on electronic monitoring, the judge ruled. A date for the trial has not yet been set.