Comment by nikcub | Hacker News Reader

Comment by nikcub | Hacker News Reader

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This is a new crime.

The original crimes he plead guilty to in 2015 and was sentenced (money laundering, obstruction of justice). This new crime he plead guilty to a few months ago and was sentenced this week (money laundering).

The new crime is that after he had plead guilty in the 2015 case he was out on bond awaiting sentencing. During that time he took a backup of the Bitcoin private key for the 1,600 Bitcoin the USG had seized from him and moved them to an offshore account.

The USG went to sell or move the Bitcoin they had seized from Bridges and found all of the addresses empty

He was caught (again) and plead guilty (again) - and this time handed over all of his keys and hardware wallet and returned the 1,000 (on a hardware wallet) + 600 (in a market account) coins

As an aside - the obstruction of justice charge is insane. In his first theft, he transferred some coins to a personal MtGox account. He later learned that the USG was investigating MtGox and knew that eventually they would discover his MtGox account if it was seized. So he transferred his MtGox coin out and then sent them a seizure notice so that they would be tipped off to the investigation.

It had its intended affect - the DOJ called off its investigation into MtGox (this was mentioned in sentencing memo)

Ars do a good summary of the new charges and some of the other aspects of the case:

https://arstechnica.com/tech-policy/2016/07/corrupt-agent-wh...

edit: To add, we don't get many technical details of this case because of the plea - but i'm curious to know for certain how they traced the second theft back to Bridges and how they found his new Bitfinex account. It isn't hard to believe they always suspected he had taken them, and then worked backwards looking at his movement etc. - but for now we can mostly only speculate

Here is what we do know. A day before he was supposed to hand himself in, he was raided and they found id documents, offshore corporate records, a new passport, citizenship applications for his wife for a third country, a macbook with serial number filed off, etc. Its likely they subpoenaed bitcoin markets for those offshore entity names. It also looked like he was going to run:

http://ia601308.us.archive.org/17/items/gov.uscourts.cand.28...

24 Months for this is crazy. He stole 10.4 million dollars of goods. He tipped off about another case coming against MtGox and knowingly continued these activities after being caught.

I think this just shows the weakness of out sentencing guidelines. People with a thousand dollars of drugs get decades and this guy gets 2 years tacked on?

24 Months for this is crazy

No it isn't. It's USA, snatch a chain (not trivial considering the trauma to the people but still...) while having a gun and you may get 99 years (Texas). Steal millions or billions and get a sentence of months.

It looks ridiculous on paper, but it does make sense in the grand scheme of things.

Aggravated assault/battery gone wrong has permanent consequences. Whether it's a $3 chain, a $3k necklace or a $30k car, when I steal it at gunpoint, an error in execution can result in loss of life. Life is not replaceable. There is no justice to be had, even if I'm caught.

An embezzlement or scam gone wrong results in a few more digits than intended getting shuffled around and an insurance claim gets filed; if it falls through maybe a company goes under, a retirement fund/livelihood is ruined but in the end, all the players victimized are free to try living again in some capacity and/or try to seek restitution. That's what justice is supposed to entail.

Knowing crime is a predictable behavior, we are much better off as a society guiding determined criminals towards the lesser consequences of white collar crime.

Would you rather someone open a $300k HELOC in your name or potentially kill you for the $20 in your wallet?

Yes, I would rather be mugged and have someone take $20 from my wallet than have someone take my entire retirement. Perhaps for you "a few digits" off your retirement isn't a huge issue because you can just send more money in, but that isn't true for the majority of the population.

The reason for these harsh sentences isn't because they were "risking someone else's life", if it were we would have similar penalties for drunk driving.

The basis for these disparities are clearly classism, racism and political fear mongering.

> Yes, I would rather be mugged and have someone take $20 from my wallet than have someone take my entire retirement.

It's funny because I would make the exact opposite choice than you. Of course it isn't about just losing a $20 from my wallet, its about having a gun put on you.

I'd rather lose my retirement than have anyone I know be robbed at gunpoint. And I believe there are a lot of people agree with me which is why the law is like that in Texas.

The law is not like that in texas because people are concerned with the risk of injury or death. If it were there would be a much harsher penalty for a first time DWI than:

"After your first DWI offense in Texas, you may be fined up to $2,000 and spend between three and 180 days in jail."

These differences in penalties are not due a rational fear of the associated risks.

Not everybody survives muggings, carjackings or home invasions, even when they comply. It's a choice between paying $20 to play Russian Roulette with a twitchy felon on the side of the road, or being scammed out of $300k and walking away. If you only look at the financial outcomes, of course it's an easy choice to make.

I only have so many working years left. Not enough to recover from such a scenario. But I'd still choose to be old and destitute than risk orphaning my children for want of $20. Keyword being risk-- I'm aware most muggings do not end violently.

A loss of your retirement funds could just as easily happen due to general economic instability. Medical bills. Bain Capital. But you get to try to pick up the pieces however you can...because however your loss was incurred, it didn't actually kill you.

The basis for these disparities has more to do with criminal intent than you're admitting...and everybody wanting tougher DUI laws until they get charged with one.

> Not everybody survives muggings, carjackings or home invasions, even when they comply. It's a choice between paying $20 to play Russian Roulette with a twitchy felon on the side of the road, or being scammed out of $300k and walking away. If you only look at the financial outcomes, of course it's an easy choice to make.

That is pretty obvious and condescending to say. Obviously everyone has a different risk preference. I was responding to a question (which was attempting to be rhetorical), not trying to tell you what your risk preference should be.

> The basis for these disparities has more to do with criminal intent...

If the basis for the disparities is criminal intent, then we wouldn't have seen the 2 year sentence for stealing 10 million dollars that is under discussion.

A mugging for $20 has less criminal intent than a $10MM white collar crime and muggings kill far fewer people every year than drunk drivers.

Disparities in punishments are highly driven by political fear mongering, classism and racism. (though this has somewhat lessened in recent years)

It simply reflects social priorities. If physical violence were tolerated as commonplace and had few deterrents then a lot of people would feel much more unsafe all the time.

I wonder if you have ever lived day to day in a place where a few wrong words to virtually anyone would get you beaten with zero consequences to the attacker. I have and I absolutely don't miss it vs. living today in a place with virtually absolute physical safety but a more wild west financial industry.

My apologies, your response made it seem like you were ignoring key factors in the question.

> If the basis for the disparities is criminal intent, then we wouldn't have seen the 2 year sentence for stealing 10 million dollars that is under discussion.

Look at your state's sentencing guidelines for larceny. To use California's as an example, it doesn't matter if I steal $20 (petty larceny) or $20M (grand theft). Either way, it's the same crime, differing only in scale, and the sentencing guidelines proscribe probation to 3 years in prison, depending on the severity. Thus, a 2 year sentence for stealing 10 million dollars is an expected outcome. That is the punishment for larceny with criminal intent. Not having criminal intent gets its own category (receiving of stolen property) and sentencing of up to 1 year. 2 years is a long time to be institutionalized; it's not a trivial sentence. We often lose sight of that.

If I choose to muck things up by bringing a weapon into the mix and turning it into aggravated assault or robbery, the sentencing changes drastically. Nobody wants aggravated crime in their neighborhood, but we can tolerate a Madoff or Shkreli on the streets, even if their net damage is worse. This isn't about race or class, it's about what type of offender is less likely to be an immediate danger to our health and safety. Can a violent offender be rehabilitated? We don't know, and nobody wants to find out. So we lock them up for 99 years and revisit the matter once they're senile.

> A mugging for $20 has less criminal intent than a $10MM white collar crime and muggings kill far fewer people every year than drunk drivers.

You're comparing three different things. Theft is theft. If you intend to steal anything, it's criminal intent. Threatening your victim or pointing a gun at them demonstrates even more criminal intent. Drunk drivers have no intent, they are drunk.

As destructive as drunk driving is, I meant what I said about everybody wanting more restrictive sentences until they find themselves on the wrong end of these laws. It doesn't take much to get charged with DUI, and even if nobody got hurt it's still career-ending. You did something you shouldn't have, there were no victims, but your life is now radically altered for the worse. It boils down to a tragically negligent decision, not criminal intent, which is why in the best of cases you end up on probation with misdemeanor charges and losing your job, in other cases Joe Sixpack hitting a pedestrian gets sentenced for manslaughter and the guy who deliberately drove into protesters is facing murder charges. There are distinct differences in intent and consequences for our actions. We sentence in line with them.

I'd agree that the sentencing for DUI fatalities is lighter than it should be (as it lets politicians and debutantes off the hook when they get caught themselves), and policing of the drug wars has proven to be very clearly class- and race-driven, but I'm not seeing how disparities in sentencing guidelines are inherently discriminatory towards any demographic. The message is clear: shoplift if you must, but don't you dare stick a gun in the cashier's face. This applies to everyone.

a retirement fund/livelihood is ruined but in the end, all the players victimized are free to try living again in some capacity and/or try to seek restitution. That's what justice is supposed to entail.

Before or after the heart attack for losing everything? Rent is due tomorrow and restitution 4 years later doesn't help much

False choice. Why can't both be locked up forever?

Yes, but I believe armed robbery is something very different as you intend or at least calculate the risk in to use your gun. This was "only" theft and lying to police.

No one was physically threatened.

The problem here is the decades...

> a macbook with serial number filed off

This really tickled me for some reason. Does he know something that we don't?

That serial numbers are traceable to where and by who the device was bought? Nope, pretty sure everybody knows that. What this agent probably didn't know was that laptops aren't bikes and the serial number is available in more places. In OSX you can see it by simply going to the Apple menu > About this Mac.

How is that hardcoded into the device? It's not just on the drive somewhere. Is it changeable? Not something I'd really thought about before but maybe there's some way of changing it.

Usually its on the logic board.

Usually it's quite literally burned into a ROM chip.

The serial number is burned into the motherboard. At least in the case of Lenovo laptops I've dealt with, it seems to be possible to modify. When we send machines for repair, if they replace the motherboard it comes back with the same serial number we sent in. In some cases, we've been sent systems without serial numbers and they refuse to boot.

My 2010 MBP came without a serial number burned into it. It was causing trouble when I tried to use things like Facetime from the Mac because apparently the protocol depends on this serial number. I had to download a utility and burn it to CD, boot the CD and flash a serial number of my choice. I was tempted to go with 0000000001...

I've had that after a repair (2007 MBP logic board replacement). Facetime refused to work without a serial number.

I don't know how old the agent's MacBook was, but since at least 2012 most components have their own individual serial numbers that are associated with the computer. So even if someone too clever by half starts swapping the logic board your Apple computer will call home and get flagged if the numbers don't match.

He was convicted of stealing confiscated property. Maybe this computer was confiscated as well, maybe he stole it, and maybe it already had its serial number filed off.

>A day before he was supposed to hand himself in, he was raided

If you're fleeing the country to evade imprisonment, why would you wait until the day before you're to be taken into custody to do it?

It's mostly the stupid criminals who make the news. Otherwise they would get away and for reasons of ongoing investigations, there would be no news.

Offshore account? As in transfer his wallet credentials to some safe offshore vault?

This word sounds scarier than what it means in 2017, especially in the context of crypto-currencies. An HTTP request to a BTC wallet server in any foreign country could be an 'transfering to an offshore account'. No banks are storing BTC for you AFAIK, no money would be transferred via Swift or other formal means.

And it wouldn't make sense for someone about to go to jail for BTC related crimes to be mailing an encrypted thumb drive to a safe deposit box in a foreign country...

In this case the BTC wasn't his to begin with so he had zero rights to do anything with it.

He spent the bitcoins to a new UTXO that the Feds didn't have access to. Since these "accounts" exist on the block chain, which is replicated on computers all over the world, I guess every account is an offshore account.

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