Shakeeb Ahmed, a computer security engineer, has been sentenced to three years in prison followed by three years of supervised release in Southern New York District (SDNY) Court. This comes after Ahmed was found guilty of conducting flash loan attacks on decentralized Crypto Exchange and Nirvana exchanges in 2022.
In a statement, U.S. Attorney Damian Williams highlighted Ahmed’s conviction as the first for hacking a smart contract. Along with the prison sentence, Ahmed has been ordered to forfeit $12.3 million in addition to a significant amount of cryptocurrency and pay $5 million in restitution to the affected exchanges.
Ahmed had offered to return the stolen funds to Crypto Exchange, except for $1.5 million, on the condition that the exchange refrain from contacting law enforcement. Nirvana, another affected exchange, offered him $600,000 for the return of funds, but negotiations broke down when Ahmed demanded $1.4 million.
Following the hack, Nirvana’s NIRV stablecoin depegged from the U.S. dollar, and its native ANA coin plummeted by 85%, eventually leading to its closure. Although a third exchange, Crema, was also attacked using similar methods in July 2022, federal charges did not link Ahmed to that incident.
At the time of the attacks, Ahmed was employed as a senior security engineer for an international technology company and was reportedly the technical lead of Amazon’s bug bounty program. Currently released on bail, he is said to be working for a mental health care startup, where he has sought therapy following his trial. Ahmed was arrested in New York in July and charged with wire fraud and money laundering before pleading guilty to a single charge of computer fraud in December.
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