Safety engineer jailed for 3 years for $12M crypto hacks

Shakeeb Ahmed, a cybersecurity engineer convicted of stealing round $12 million in crypto, was sentenced on Friday to 3 years in jail.

In a press release, the U.S. Legal professional for the Southern District of New York introduced the sentence. Ahmed was accused of hacking into two cryptocurrency exchanges, and stealing round $12 million in crypto, based on prosecutors.

Adam Schwartz and Bradley Bondi, the attorneys representing Ahmed, didn’t instantly reply to a request for remark.

When Ahmed was arrested last year, the authorities described him as “a senior security engineer for an international technology company.” His LinkedIn profile mentioned he beforehand labored at Amazon. However he wasn’t working there on the time of his arrest, an Amazon spokesperson advised TechCrunch.

Whereas the identify of one in every of his victims was by no means disclosed, Ahmed reportedly hacked into Crema Finance, a Solana-based crypto trade, in early July 2022.

Then, weeks later, he hacked into Nirvana Finance. Ahmed stole $9 million and $3.6 million in these two hacks, respectively. Within the case of Nirvana Finance, the stolen funds “represented approximately all the funds possessed by Nirvana,” which led Nirvana Finance to close down, based on the press launch.

Ahmed pleaded responsible to having carried out each cyberattacks.

After he hacked Crema, Ahmed contacted the corporate in an try to return the stolen funds, aside from a charge of $1.5 million — a kind of unofficial finder’s charge — and a promise that Crema wouldn’t report the assault to the authorities. Crema declined, and Ahmed was finally apprehended.

Whereas this sort of deal is uncommon within the cybersecurity world, it has become normalized within the crypto world. These offers are also known as “white hatting,” regardless that it includes hacking a goal and stealing a sufferer’s funds with out their consent, which is extra akin to what a “black hat” hacker would usually do. Ahmed’s case reveals that whereas the crypto trade has accepted that this sort of offers are typically the price of doing enterprise, regulation enforcement doesn’t see it the identical method.

Other than three years in jail, Ahmed was additionally sentenced to 3 years of supervised launch, and ordered to forfeit $12.4 million “and a significant quantity of cryptocurrency and pay restitution to the Crypto Exchange and Nirvana in the amount of over $5 million,” based on the prosecutors’ press launch.