Former security engineer Shakeeb Ahmed was sentenced to three years in prison on Friday after prosecutors said he hacked into two decentralized crypto exchanges, stealing more than $12 million worth of crypto.
The case involved the first-ever conviction for hacking a smart contract, said Damian Williams, the U.S. attorney for the Southern District of New York. rack on Friday. Ahmed had done that before pleaded guilty of hacking the exchanges.
“No matter how new or sophisticated the hack, this agency and our law enforcement partners are committed to following the money and bringing hackers to justice,” Williams said. “And as today’s verdict shows, a prison sentence – and the loss of all stolen cryptocurrency – is the inevitable consequence of such destructive hacks.”
Ahmed, 34, was charged in July with bank fraud and money laundering. Prosecutors said he launched an attack on a decentralized crypto exchange and used fake pricing data to generate $9 million in fees, then withdrew the fees in crypto. A few weeks later, Ahmed carried out a second attack on the decentralized crypto exchange Nirvana Finance. Prosecutors said he later laundered the millions he stole, partly using crypto mixers to hide the ownership.
Ahmed was also ordered Friday to forfeit approximately $12.3 million and a “significant amount of cryptocurrency” and repay $5 million to the unnamed crypto exchange and Nirvana, according to the Justice Department statement.
In court
Prosecutors had asked Ahmed for four years in prison, according to court documents.
Ahmed told the court on Friday that he had lost his way.
“I got lost. I apologize to the users of Nirvana Finance,” Ahmed said, according to reports from Press city center. “(Gasp) I grew up in a harsh and unforgiving household. I was drawn to technology. I got lost. During the pandemic, I turned to crypto.”
About the author
Sarah is a reporter at The Block and covers policy, regulations and legal events. Previously, Sarah was a reporter at CQ Legal writing about securities regulation, where she first started reporting on crypto. Sarah has also written for The Bond Buyer and American Banker, among others. She graduated from the University of Missouri with a degree in print and digital journalism. Sarah lives in Washington DC and is an avid coffee lover. You can follow her on Twitter @ForTheWynn.
