Criminal hacking is nothing new, but this case has it all: religion, bitcoin, and ransomware. It’s hard to turn away. Unfortunately real people and their lives were impacted, along with the early reputation of the world’s most popular cryptocurrency.
Praise the Lord, Pass the Code
It’s a criminal enterprise stretching across as many different borders as it does strange elements. From Israel to Russia, Florida and New Jersey, U.S. v. Murgio 15-cr-00769 is part familiar tale of greed and covering tracks mixed with the very latest in cyber-related criminality. Toss in some religion and cryptocurrency, and Hollywood would laugh such a plot out of the studio.
The leader of a non-denominational Christian congregation might’ve taken pause at donations totaling 150,000 USD. According to his attorney, however, Pastor Trevon Gross accepted money as gifts toward his ministerial work, never bribes.
How exactly he gets involved with the likes of a native Ukraine-Russian tech genius, an Israeli criminal mastermind, and a Florida restaurateur is explained by the Federal Bureau of Investigations (FBI) and Secret Service.
Pastor Gross, it turns out, had taken reign of a 100 plus member church federal credit union, operating for nearly 40 years to low-income residents. Pastor Gross and Anthony Murgio, a litigious Floridian restaurant owner dabbling in cryptocurrencies, arranged 150K USD in bribes funneled as consulting fees. This, authorities claim, gained Mr. Murgio access to the church’s bank.
Mr. Murgio exploited lack of overt laws governing cryptocurrencies at the credit union level to run 60 million dollars in transactions through its coffers, the FBI alleged, an excellent return on investment.
Bitcoin Not to Blame
Headlines have termed it the “Bitcoin Scam,” but clearly it had little ultimately to do with the conspirators’ actions.
Collectables Club Private Members Association was Mr. Murgio’s front-memorabilia business through which bitcoins were laundered, law enforcement points out. Having access to a federal credit union meant an underground bitcoin exchange could be created if the right specifications were set.
Enter Russian-emigre programmer Yuri Lebedev who wished to create “cutting edge technology,” and did something like that for Coinmx, he admitted as the latest of the co-conspirators to be sentenced. According to Bloomberg, Mr. Lebedev wanted to “build something ‘that would make me exceptional. I got carried away,’” the article continues, “there are no shortcuts.”
Coinmx was born, with help and guidance from exchange owner Gary Shalon, the FBI asserts, an Israeli accused of notorious ransomware hacks against JP Morgan while profiting from the credit union exchange. Mr. Shalon maintains his innocence.
Secret Service insists Mr. Lebedev and “co-conspirators acquired control of HOPE FCU,” the church’s bank. Pastor Gross “was the Chairman of the Board of HOPE FCU,” summary of the indictment reads, “and assisted their efforts in exchange for bribes.”
Judge Nathan, however, gave Mr. Lebedev “considerably less time than the maximum of 10 years recommended by U.S. sentencing guidelines, finding he was neither a leader nor a mastermind, and noting he had no criminal history,” Bloomberg points out. “He did what he was told to do,” the judge sympathized.
Mr. Lebedev will serve a year and four months for his participation.
Pastor Gross is facing up to 35 years in prison, and remains on staff at his church.
The church’s credit union was seized and liquidated.
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Images courtesy of: Abiline jail, Youtube, LinkedIn.
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Author: C. Edward Kelso