A former Microsoft software engineer was sentenced to nine years in the U.S. federal prison by the U.S. District Court in Seattle for stealing from Microsoft more than $10 million in digital value in the form of “currency stored value” (CSV), such as gift cards, according to a statement by the U.S. Department of Justice (DoJ).
Ukrainian citizen Volodymyr Kvashuk, 26, was awarded the sentence for 18 federal felonies related to his scheme to defraud Microsoft of more than $10 million. He initially worked as a contractor at Microsoft and then as an employee from August 2016 until he was fired in June 2018.
Kvashuk was also ordered to pay more than $8.3 million in restitution and he may be deported following his prison term.
Kvashuk was convicted in February 2020 by a jury of five counts of wire fraud, six counts of money laundering, two counts of aggravated identity theft, two counts of filing false tax returns, and one count each of mail fraud, access device fraud, and access to a protected computer in furtherance of fraud.
“Stealing from your employer is bad enough, but stealing and making it appear that your colleagues are to blame widens the damage beyond dollars and cents,” said U.S. Attorney Brian Moran.
According to the DoJ, Kvashuk resold the CSV on the internet, using the proceeds to live the life of a millionaire after purchasing a $1.6 million dollar lakefront home and a $160,000 Tesla vehicle. He also used test email accounts associated with other employees for the crime after using his own account access initially.
He used a bitcoin “mixing” service in an attempt to hide the source of the funds ultimately passing into his bank account. As a knowledgeable software developer, he attempted to mask digital evidence that would trace the fraud and the internet sales back to him.
In total, Kvashuk transferred approximately $2.8 million in bitcoin to his bank and investment accounts over seven months. He then filed fake tax return forms, claiming the bitcoin had been a gift from a relative.
Kvashuk testified at trial that he did not intend to defraud Microsoft. He claimed to be working on a special project to benefit the company.
The Internal Revenue Service (IRS) claims that Kvashuk’s criminal act of stealing from Microsoft, and subsequent filing false tax returns, is the nation’s first Bitcoin case that has a tax component to it.
Source: Read Full Article