Former Microsoft engineer accused of stealing £10 million in cryptocurrency, sentenced for 18 federal felonies

During his employment in 2018, a former Microsoft engineer used his position to steal $10 million worth of cryptocurrency. The recent verdict has been reached, and he will be sentenced for multiple federal felonies.

• Anonymously trading using a mixer service
• International regulatory bodies focusing on cryptocurrency mixers.

Facing 20 Years in Prison

The U.S. Department of Justice announced on Tuesday that a former Microsoft software engineer was convicted of 18 federal felonies for stealing over $10 million in virtual currency, emphasizing that the engineer used "Mixer" for money laundering (BTC), which was one of his crimes.

The engineer, identified as Volodymyr Kvashuk, a 25-year-old Ukrainian citizen residing in Washington, was a contractor and employee at Microsoft from 2016 to 2018, and was terminated in June 2018.

After a 5-day trial, KVASHUK will be sentenced for 5 counts of wire fraud, 6 counts of money laundering, as well as identity theft, filing false tax returns, mail fraud, and other charges.

According to court records and testimony, Kvashuk was involved in testing Microsoft's online retail platform and stole millions of digital gift cards by using "test access" to convert them into Bitcoin, which he used to purchase a $1.6 million lakefront home and a $160,000 Tesla.

Authorities noted:

Kvashuk used "Mixer" to trade cryptocurrency and cover his tracks when purchasing Bitcoin. He held $2.8 million in Bitcoin, which he falsely claimed on tax returns as gifts from relatives. Additionally, Kvashuk used a colleague's email account as one of his tools for committing the crimes.

During the trial, Kvashuk claimed he did not intend to defraud Microsoft, emphasizing he was working on projects beneficial to the company. Despite this, the jury found him guilty, and he faces up to 20 years in prison.

Mixer Draws Regulatory Attention

The Bitcoin mixer service "Mixer" may have become a target for regulatory bodies. In early February, Larry Harmon, who operated the Bitcoin mixer service Helix, was indicted by U.S. authorities, alleging that the service facilitated the anonymous trading of $300 million in Bitcoin for illicit purposes.

Furthermore, a joint statement by the Joint Chiefs of Global Tax Enforcement (J5) on February 18 highlighted the arrest by the Dutch Fiscal Information and Investigation Service (FIOD) of two Dutch nationals suspected of money laundering and tax evasion using the Bitcoin mixer service Bestmixer.io.

In fact, the purpose of Bitcoin mixers is to enhance the anonymity of cryptocurrencies, using algorithms to obfuscate the flow of funds and make tracing transactions more difficult. While there are currently no specific regulations for such services, engaging in illegal activities such as tax evasion, drug trafficking, or violating anti-money laundering policies will undoubtedly lead to investigations by law enforcement agencies.

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