A former safety engineer has been sentenced to 3 years in jail within the U.S. for fees referring to hacking two decentralized cryptocurrency exchanges in July 2022 and stealing over $12.3 million.
Shakeeb Ahmed, the defendant in query, pled guilty to at least one depend of laptop fraud in December 2023 following his arrest in July.
“On the time of each assaults, Ahmed, a U.S. citizen, was a senior safety engineer for a world know-how firm whose resume mirrored abilities in, amongst different issues, reverse engineering sensible contracts and blockchain audits, that are a few of the specialised abilities Ahmed used to execute the hacks,” the U.S. Division of Justice (DoJ) famous on the time.
Whereas the identify of the corporate was not disclosed, he was residing in Manhattan, New York, and working for Amazon earlier than he was apprehended.
Courtroom paperwork present that Ahmed exploited a safety flaw in an unnamed cryptocurrency change’s sensible contracts to insert “pretend pricing information to fraudulently generate thousands and thousands of {dollars}’ value of inflated charges,” which he was in a position to withdraw.
Subsequently, he initiated contact with the corporate and agreed to return many of the funds besides for $1.5 million if the change agreed to not alert regulation enforcement concerning the flash loan attack.
It is value noting that CoinDesk reported in early July 2022 that an unknown attacker returned greater than $8 million value of cryptocurrency to a Solana-based crypto change referred to as Crema Finance, whereas maintaining $1.68 million as a “white hat” bounty.
Ahmed has additionally been accused of finishing up an assault on a second decentralized cryptocurrency change referred to as Nirvana Finance, siphoning $3.6 million within the course of, finally resulting in its shutdown.
“Ahmed used an exploit he found in Nirvana’s sensible contracts to permit him to buy cryptocurrency from Nirvana at a cheaper price than the contract was designed to permit,” the DoJ stated.
“He then instantly resold that cryptocurrency to Nirvana at a better value. Nirvana supplied Ahmed a ‘bug bounty’ of as a lot as $600,000 to return the stolen funds, however Ahmed as an alternative demanded $1.4 million, didn’t attain settlement with Nirvana, and stored all of the stolen funds.”
The defendant then laundered the stolen funds to cowl up the path utilizing cross-chain bridges to maneuver the illicit digital property from Solana to Ethereum and exchanging the proceeds into Monero utilizing mixers like Samourai Whirlpool.
In addition to the three-year jail time period, Ahmed has been sentenced to 3 years of supervised launch and ordered to forfeit roughly $12.3 million and pay restitution amounting greater than $5 million to each the impacted crypto exchanges.
