May 31, 2023

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Judge orders release of alleged bitcoin launderer Razzlekhan

Judge orders release of alleged bitcoin launderer Razzlekhan

On Monday, a judge ruled that Heather Morgan, also known as Razalkhan, be released on bail after she and her husband were released. They got caught Allegedly helping to launder billions of dollars worth of stolen bitcoin. Morgan and her husband Elijah “Dutch” Liechtenstein were released on bail last week by another judge, but the government secured an emergency stay based on the earlier order, saying the couple could use millions of dollars in unconfined bitcoin to flee the country.

A hearing was held on Monday to review the release order and consider more evidence for the prosecution and defense. You can read both of the written arguments below, which largely reflect what the parties argued in court. The presiding judge decided that Morgan could await her trial at home if she released her on bail, but did not invalidate Liechtenstein’s stay, meaning he would remain in custody.

The couple were arrested over allegations they attempted to launder some of the 119,754 stolen bitcoin in the Bitfinex 2016 hack. While the government has seized most of this crypto (worth around $3.6 billion last week), it claims in court documents that there are still millions of dollars left unaccounted for. You can get it yet. It also says that the couple bought 70 gold coins with money linked to the attack, which was not found while searching the couple’s apartment (they discovered hollowed-out empty books, a briefcase of mobile phones, and several cryptocurrency wallets).

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After her arrest, Morgan She got a lot of attention on social media After discovering that she was posting rap music, videos, and fashion content under the name Razzlekhan. Clips of particularly embarrassing moments from her music videos have been shared online since the news of her arrest, along with startling comments that the person singing about being the “crocodile of Wall Street” was involved in the Bitfinex hack.

During Monday’s hearing, the government argued that Morgan and Liechtenstein could use the unconfined money or gold to escape to a country not particularly willing to extradite them, such as Russia or Ukraine (Liechtenstein was born in Russia and renewed his passport in 2019 according to the government). He also argued that they would be motivated to do so, given that they could face significant financial penalties and 25 years in prison if convicted of fraud and money laundering.

The couple’s lawyer argued that they were unlikely to flee for several reasons – Morgan is currently recovering from surgery, and both her parents and Liechtenstein’s parents have posted their homes as collateral for bail. He also argued that if they wanted to escape, they would have done so in the week or two prior to the arrest, asserting that they would have known the government was with them after receiving a summons from the ISP, and seeing the seized funds. The prosecution responded by saying that it was highly unlikely that the couple realized the amount of evidence the government had until their arrest, given that much of it was obtained by decoding encrypted files that Liechtenstein stored on a cloud service.

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The judge said Liechtenstein would not be released on bail because government evidence claims he was largely in control of the money – and Morgan deemed it unlikely she would get the money that would help her escape. She said Morgan must follow the terms outlined in the original release order, which include house arrest, an ankle bracelet for website monitoring, restrictions on computer use, and a ban on cryptocurrency transactions.

An argument for why Liechtenstein and Morgan should be allowed on bail, prepared by their lawyers

The government’s argument about not allowing Liechtenstein and Morgan to be released on bail