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A US Citizen is Arrested for Stealing $9M in Crypto

A US Citizen is Arrested for Stealing $9M in Crypto

The US authorities have arrested former security engineer Shakeeb Ahmed on charges of wire fraud and money laundering in connection with a hacking of a decentralized exchange worth an estimated $9 million.

This is reportedly the first criminal case related to smart contracts. According to the investigation, Ahmed allegedly exploited a vulnerability in one of the exchange’s smart contracts in July 2022, entering false price data which resulted in the protocol generating approximately $9 million in fees that were illegally obtained.

Subsequently, he offered the platform to return the stolen funds in exchange for a reward of $1.5 million if they would not contact the police.

The suspect is also said to have searched webpages for information about hacking and criminal liability, and even potential ways to “escape the country with cryptocurrency” and “purchase citizenship.”

US Attorney Damian Williams for the Southern District of New York stated that their department followed the money “no matter the complexity of the transactions and hops across different blockchains and overseas cryptocurrency exchanges.”

Ahmed faces up to 20 years in prison if convicted. This case comes on the heels of the arrest of 33-year-old Russian Mikhail Vasiliev in November 2022, who is suspected of having orchestrated large-scale hacker attacks using LockBit ransomware.