The judge was furious
IRS agents discovered that the bitcoins were transferred from addresses they knew over a six-day period in April 2020. Prosecutors returned to court and Howell said they were “extremely doubtful” that the crime took place without Larry’s knowledge or direction. The judge asked him, “Do you understand that?” “Yeah, I know,” said Larry. The judge yelled at him: “Don’t try to be nice to me.”
Howell orders Larry to hand over all his passwords so customers can transfer the remaining 4,164 bitcoins, worth $40 million, to a secure wallet. Larry handed over the passwords and the thefts stopped. He continued to deny any role in the plot, but if not Larry, then who was?
Within a month, Larry told prosecutors that Gary was the culprit. It took an additional 15 months for prosecutors to convince Larry to plead guilty to money laundering and agree to testify against Gary and the shady internet operators. Larry faces up to 20 years in prison, but his cooperation with prosecutors could reduce his sentence. The US Treasury Department fined him $60 million in civil fines.
After giving up 100 million dollars.. “Bitcoin” pioneer: I have no regrets
Federal agents began their case against Gary after they were told by an informant that Gary had received a tip about Bitcoin gambling services, records show. The source believed Gary wanted to use the bitcoins he took from Larry to mix, and the informant said Gary “wasn’t smart and didn’t think about the consequences for his brother” before transferring the bitcoins.
Customers later found four emails sent to Gary’s Gmail account from no-reply@trezor.io, indicating that the wallets were recreated on other devices. Gary refused to accept Bitcoin. Gary asked during an interview in July 2020, “If I took it, why didn’t I take it all?” “The fact that the government can’t keep up with their technology is not the defendant’s problem,” his attorney finally said in court.
.