Case winnick: how to steal nine billion dollars

© AP Photo / Giannis Rerady of Russia Alexander Vinnik surrounded by police officers at the airport in Thessaloniki. 29 September 2017Case winnick: how to steal nine billion dollars© AP Photo / Giannis Papanikos

This week the Supreme court of Greece decided to give Russia Alexander Vinnik, who was arrested by the Greek police at the request of the U.S. justice Department. Us authorities have accused the Russian citizen in the money «from four to nine billion dollars» in the States, he faces 20 years in prison and a fine of 500 thousand dollars. Where did the «billions winnik» and what does the bitcoin in the material RIA Novosti.

The disappeared bitcoins

This story began seven years ago: in March 2011, the Japanese company «Tibanne Co., Ltd.», owned by French entrepreneur Mark Capeles, bought a crypto currency exchange Mt.Gox — one of the first Internet sites, a seller of bitcoin.

In June of the same year Mt.Gox hacked: an unidentified attacker flooded the market system about the contracts for the sale of bitcoins «at any price» has fallen off a quote of cryptocurrency to one cent. Then bought «now» at this price for a large sum.

A month later, on 17 July 2011, the Internet has opened the first Russian-speaking crypto currency exchange BTC-e.

Mt.Gox after a hacker attack has significantly strengthened security measures, introducing, in particular, two-factor authentication clients. Due to this, the exchange managed to regain the trust of traders, and by the spring of 2013 passed through it half of all transactions for the purchase and sale of bitcoins, and trading volume in dollars was over 80 per cent of the global turnover of cryptocurrency.

Then you have problems, constant delays in dollars to the personal accounts of clients. Traders feverishly buying on Mt.Gox bitcoins and transfer them to other crypto currency exchange to have it convert into dollars and withdraw real money in their wallets. For capturadora from Russia and countries of the former USSR, the main channel for this was BTC-e.

Due to the Exodus of traders in July 2013, Mt.Gox lost the lead in terms of trading main competitor — the crypto currency exchange Bitstamp. And by the end of the year the market share of Mt.Gox has fallen to a modest ten percent.

In the end, 7 February 2014, Mt.Gox has stopped working. Three weeks later, the official crypto currency exchange filed for bankruptcy, admitting a loss of nearly 850 thousand bitcoins. From them 100 thousand was Mt.Gox, the rest of her customers.

At the end of March of the same year, the General Director of Mt.Gox mark Karpeles accidentally discovered 200 thousand bitcoins on one of the frozen accounts. The remaining 650 thousand «friend» just disappeared.

As later stated in court Karpeles in Tokyo, «technical problems in the platform opened access for the illegal seizure of our customers ‘funds by criminals».

«Give me the money!»

Many customers of Mt.Gox was confident that bitcoins stolen mark Karpeles. However, there were also those who believed in the version about the unknown intruders. In particular, the Swedish programmer Kim Nilsson decided in that whatever was to find those responsible for the loss of money.

The possibility of a hacker attack existed, because bitcoin is based on the technology of the blockchain, or the distributed registry in which records of all cryptocurrency transactions are stored on many computers.

Analyzing the repository on Mt.Gox, Nilsson found that the exchange broke even in the fall of 2011, shortly after I opened BTC-e. Hackers took control of the keys to client wallets and the addresses of Bank deposits of the exchange and passwords to them.

Within two years, hackers steal a little bit from Mt.Gox money, and as a result, by the middle of 2013, the stock exchange lost all their bitcoins — that is eight months before the official announcement of bankruptcy.

That’s when delay started with the withdrawal of funds because Mt.Gox has been working on the principle of a financial pyramid: stock used deposits from new clients to pay old ones.

Installing this, Nilsson has continued to seek an answer to the main question — who stole the clients ‘ money Mt.Gox. By the beginning of 2016 he had a suspect.

Tracking transaction history, Nilsson realized that over 650 thousand bitcoins missing from the exchange, 630 thousand were in the wallets controlled by one person, hiding under the nickname WME.

Nilsson began to scour the online forums about bitcoin in search of a user with the same name. He was lucky — in the archives of one of the forums he came across an old message that WME complained that BTC-e has delayed the transfer him money. «Give me my MONEY!» — demanded WME.

Later, he even threatened to exchange prosecution by posting a corresponding letter of private counsel.

And made a fatal mistake, do not gloss over your name and surname: Alexander Vinnik.

Nilsson immediately reported the discovery to the special agent, IRS Gary Alford, specializing in tax crimes kryptomere.

Arrest

By 2017 BTC-e became the biggest Russian platform for buying and selling cryptocurrency. After six years of successful development of its daily turnover is closer to 70 million dollars.

But on 25 July, 2017 13:49 Moscow time, the website of the stock exchange ceased to function. Seven minutes later on the official twitter channel BTC-e has published a post of unscheduled works.

After another couple of hours, Reuters reported that in Greece at the request of the U.S. justice Department arrested the Russian Alexander Vinnik. The Americans called him the leader of a criminal organization involved in money laundering through crypto currency exchange BTC-e.

Winnick was charged with laundering money obtained through criminal activities to the tune of «from four to nine billion dollars.» It is in such amounts (depending on the current exchange rate) are estimated at 630 thousand bitcoins that went missing in the collapse of Mt.Gox.

Theft of bitcoins Mt.Gox winnick accused. But experts believe that he know how and who stole bitcoins worth billions of dollars.

«I have no doubt that he at least knows where to send the laundered money,» said Kim Nilsson to Fortune magazine.

Catherine Hawn, a former Federal Prosecutor, also confirmed the publication that «bitcoins winnik, obviously, associate it with criminals».

American investigators also suspect that winnick was among the founders of the BTC-e crypto currency exchange that was established specifically for laundering stolen bitcoins.

Only politics

Acquaintance with the seamy side of the crypto world does Alexander winnick desirable target for law enforcement agencies of any country. It is not surprising that along with the US request for his extradition by the Greek authorities sent to France, arguing their claims that the actions winnik injured French citizens.

Sam Vinnik denies the accusations of the Americans and the French. But in may he was sent to the Russian Prosecutor General recognition in the fraudulent action which resulted in the «unidentified group of Russian citizens in the period from 2011 to 2017 material damage at 750 million rubles». This allowed Russia to demand the extradition of winnik.

According to the Greek legislation the final decision on extradition of the criminal is taken by the Minister of justice. The argument in favor of Russia he will have a confession of Alexander winnick, directed to the Prosecutor General.

The American argument — the results of the investigation Nilsson, based essentially on three points: the electronic wallets on Mt.Gox, owned by someone named WME, posts on an online forum user with the same name, where was published a letter of attorney Alexander winnick, and the phrase «give me back my money» allegedly attesting to the laundering of funds via BTC-e.

But the request of France, despite the weakness of the argument is a priority due to the fact that Greece and France are in the EU area. Although there is no doubt that eventually the French will give winnik Americans.

Winnick’s lawyer Timothy Musatov, said RIA Novosti that everything that happens — «joint operation» of France and the United States to «get a head» of Alexander.

«Now we are talking about is how convincing will be transferred to the political position of Russia to the Minister of justice, who recently was appointed to his post, decided in favor of Moscow,» said Musatov.

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