People
attend the Inside Bitcoins conference and trade show, Monday,
April 7, 2014 in New York.

Mark
Lennihan/AP


  • A Florida software engineer was sentenced to 16 months
    in prison on Friday.
  • He was found guilty of scheming to help an illegal
    bitcoin exchange avoid having banks and regulators look into
    its activities.

Yuri Lebedev was sentenced by U.S. District Judge Alison Nathan
in Manhattan to 16 months in prison on Friday,
according to Nicholas Biase, a spokesman for federal prosecutors.

The bitcoin exchange involved in the case, Coin.mx, was linked to
an investigation of a data breach at JPMorgan Chase & Co,
revealed in 2014, that exposed more than 83 million accounts.

“We are dismayed that Mr. Lebedev has been sentenced to prison,”
Lebedev’s lawyer, Eric Creizman, said in an email. Federal
sentencing guidelines called for up to 97 months.

Lebedev was convicted in March along with Trevon Gross, a New
Jersey pastor.

Prosecutors charged that Lebedev helped arrange bribes to Gross,
including $150,000 in donations to his church. In exchange, they
said, Gross helped the operator of Coin.mx, Anthony Murgio, take
over a small credit union Gross ran from his church.

Murgio used the credit union to evade scrutiny of banks wary of
processing payments involving the virtual currency, prosecutors
said. Lebedev was accused of working for Coin.mx through a front
called “Collectables Club.”

Gross is scheduled to be sentenced later this month. Murgio
pleaded guilty in January, and was sentenced to five-and-a-half
years in prison in June.

The trial followed a probe rooted in the JPMorgan data breach,
which lead to charges against nine people.

Gross, Lebedev and Murgio were not accused of hacking, but
prosecutors said Coin.mx was owned by an Israeli, Gary Shalon,
who was behind the JPMorgan hack.

Prosecutors have said that Shalon, together with Maryland-born
Joshua Samuel Aaron, orchestrated cyber attacks that resulted in
the theft of information from more than 100 million people.

Prosecutors said they carried out the hacks to further other
schemes with another Israeli, Ziv Orenstein, including pumping up
stock prices with promotional emails.

Shalon, Aaron and Orenstein pleaded not guilty to criminal
charges.

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