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

A former security engineer has been sentenced to three decades in jail in the U.S. for rates relating to hacking two decentralized cryptocurrency exchanges in July 2022 and stealing about $12.3 million.

Shakeeb Ahmed, the defendant in concern, pled guilty to one count of personal computer fraud in December 2023 pursuing his arrest in July.

“At the time of each assaults, Ahmed, a U.S. citizen, was a senior security engineer for an international technology business whose resume mirrored abilities in, amongst other things, reverse engineering clever contracts and blockchain audits, which are some of the specialized capabilities Ahmed utilised to execute the hacks,” the U.S. Department of Justice (DoJ) mentioned at the time.

Even though the name of the organization was not disclosed, he was residing in Manhattan, New York, and doing work for Amazon ahead of he was apprehended.

Courtroom files exhibit that Ahmed exploited a security flaw in an unnamed cryptocurrency exchange’s intelligent contracts to insert “faux pricing info to fraudulently make tens of millions of dollars’ well worth of inflated costs,” which he was in a position to withdraw.

Subsequently, he initiated contact with the company and agreed to return most of the cash other than for $1.5 million if the trade agreed not to warn legislation enforcement about the flash mortgage attack.

It’s well worth noting that CoinDesk documented in early July 2022 that an unknown attacker returned more than $8 million truly worth of cryptocurrency to a Solana-based crypto exchange referred to as Crema Finance, although preserving $1.68 million as a “white hat” bounty.

Ahmed has also been accused of carrying out an attack on a next decentralized cryptocurrency trade termed Nirvana Finance, siphoning $3.6 million in the process, in the long run primary to its shutdown.

“Ahmed utilised an exploit he discovered in Nirvana’s clever contracts to enable him to invest in cryptocurrency from Nirvana at a decreased cost than the contract was designed to let,” the DoJ explained.

“He then promptly resold that cryptocurrency to Nirvana at a increased selling price. Nirvana supplied Ahmed a ‘bug bounty’ of as much as $600,000 to return the stolen money, but Ahmed in its place demanded $1.4 million, did not reach settlement with Nirvana, and kept all the stolen funds.”

The defendant then laundered the stolen cash to include up the trail using cross-chain bridges to move the illicit electronic assets from Solana to Ethereum and exchanging the proceeds into Monero utilizing mixers like Samourai Whirlpool.

Besides the 3-yr jail term, Ahmed has been sentenced to a few decades of supervised launch and requested to forfeit close to $12.3 million and pay back restitution amounting far more than $5 million to both equally the impacted crypto exchanges.

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