Ex-Security Engineer Jailed 3 Years for $12.3 Million Crypto Exchange Thefts

A former security engineer has been sentenced to a few yrs in prison in the U.S. for rates relating to hacking two decentralized cryptocurrency exchanges in July 2022 and stealing more than $12.3 million.

Shakeeb Ahmed, the defendant in issue, pled guilty to one particular depend of laptop or computer fraud in December 2023 next his arrest in July.

“At the time of each attacks, Ahmed, a U.S. citizen, was a senior security engineer for an worldwide technology company whose resume mirrored abilities in, among other factors, reverse engineering good contracts and blockchain audits, which are some of the specialised capabilities Ahmed made use of to execute the hacks,” the U.S. Department of Justice (DoJ) noted at the time.

When the title of the enterprise was not disclosed, he was residing in Manhattan, New York, and doing work for Amazon in advance of he was apprehended.

Courtroom paperwork demonstrate that Ahmed exploited a security flaw in an unnamed cryptocurrency exchange’s smart contracts to insert “bogus pricing facts to fraudulently make tens of millions of dollars’ well worth of inflated expenses,” which he was able to withdraw.

Subsequently, he initiated get hold of with the firm and agreed to return most of the cash apart from for $1.5 million if the trade agreed not to warn regulation enforcement about the flash mortgage attack.

It can be truly worth noting that CoinDesk described in early July 2022 that an mysterious attacker returned more than $8 million well worth of cryptocurrency to a Solana-based mostly crypto exchange referred to as Crema Finance, though retaining $1.68 million as a “white hat” bounty.

Ahmed has also been accused of carrying out an attack on a second decentralized cryptocurrency trade known as Nirvana Finance, siphoning $3.6 million in the approach, in the end major to its shutdown.

“Ahmed made use of an exploit he identified in Nirvana’s smart contracts to enable him to invest in cryptocurrency from Nirvana at a lower selling price than the deal was developed to make it possible for,” the DoJ stated.

“He then straight away resold that cryptocurrency to Nirvana at a better price. Nirvana supplied Ahmed a ‘bug bounty’ of as much as $600,000 to return the stolen funds, but Ahmed rather demanded $1.4 million, did not access arrangement with Nirvana, and stored all the stolen resources.”

The defendant then laundered the stolen resources to cover up the trail using cross-chain bridges to move the illicit digital property from Solana to Ethereum and exchanging the proceeds into Monero making use of mixers like Samourai Whirlpool.

Other than the 3-yr jail time period, Ahmed has been sentenced to a few decades of supervised launch and ordered to forfeit about $12.3 million and pay restitution amounting far more than $5 million to equally the impacted crypto exchanges.

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Some parts of this report are sourced from:
thehackernews.com