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Security Engineer Put Behind Bars for Cyber Plundering Crypto Exchanges for $12 Million

Security engineer receives three-year sentence for multimillion-dollar crypto exchange hacks

A federal judge has sentenced a former security engineer to real prison time for major hacks on decentralized crypto exchanges.

Key takeaways:

  • Shakeeb Ahmed was sentenced to three years for stealing over $12 million.
  • Ahmed to forfeit $12.3 million and pay $5 million in restitution.

Shakeeb Ahmed, a security engineer, has been sentenced to a three-year prison term followed by three years of supervised release for his involvement in the theft of over $12 million from two decentralized cryptocurrency exchanges built on Solana. The sentencing occurred on Friday, with Ahmed facing charges of wire fraud and money laundering related to his actions.

The case, which unfolded over the last year, involved Ahmed stealing approximately $9 million from an exchange believed to be Crema Finance. He admitted guilt to one count of computer fraud in December, agreeing to forfeit $12.3 million and pay restitution amounting to $5 million.

Federal prosecutors had recommended a four-year sentence, citing the statutory maximum of five years. They acknowledged Ahmed's guilty plea and cooperation, which included surrendering the proceeds from his illegal activities. 

The prosecution in a sentencing memo noted:

"Ahmed had accepted responsibility by pleading guilty and therefore warranted 'a slightly below Guidelines variance,'" 

Despite the prosecution's position, Ahmed's defense team argued for no prison time. They highlighted his proactive disclosure of another hack, this time involving Nirvana Finance, to the prosecutors. 

His defense stated:

"Shakeeb already had been indicted for the Crypto Exchange hack, and the government had offered Shakeeb a deal to plead guilty to that hack," 

"Although Shakeeb knew that disclosing another hack would result in additional consequences, and could take his favorable plea deal off of the table, Shakeeb voluntarily came forward anyway."

U.S. Attorney Damian Williams commented on the case, emphasizing the groundbreaking nature of the conviction: 

"Ahmed's guilty plea was 'the first ever conviction for the hack of a smart contract." 

Williams further stated: 

"No matter how novel or sophisticated the hack, this Office and our law enforcement partners are committed to following the money and bringing hackers to justice. And as today’s sentence shows, time in prison – and forfeiture of all the stolen crypto – is the inevitable consequence of such destructive hacks."