Crypto thief gets 12 years in prison over unpaid $20 million

A judge has dramatically increased the prison sentence of convicted crypto thief Nicholas Truglia to 12 years, citing his failure to repay $20.4 million owed to his victim.

Initially, the crypto scammer received an 18-month sentence for his role in a $22 million cryptocurrency theft scheme.

US District Judge Alvin Hellerstein, who ordered both sentences, told Truglia in the last hearing, “You paid not a cent, not one cent.”

Truglia joined a group of hackers to launder stolen assets

On Thursday, Judge Hellerstein issued the new sentence after he found Truglia willfully breached his commitment to repay what he promised. However, Mark Gombiner, Truglia’s lawyer, argued before Judge Hellerstein that the resentence was unlawful and represented an extreme misuse of judicial discretion. The lawyer has pledged to appeal.

Truglia was first sentenced in 2021, after he pleaded guilty to his part in the theft scheme. He was part of a group of so-called “evil computer geniuses” who deceived telecom workers into switching victims’ phone numbers to SIM cards they controlled.

The group targeted Michael Terpin, CEO and founder of Transform Group, a PR consultancy for blockchain firms. They drained his crypto accounts and hired Truglia to convert the stolen assets into Bitcoin.

At his first sentencing, the court learned that Truglia held $53 million worth of assets spanning crypto, fine art, and luxury jewelry. In a court filing, however, Gombiner claimed that his client had “given up every asset he could access,” including the entire balance of his Wells Fargo & Co. account. 

Truglia also claimed that most of his assets were locked in an inaccessible Bitcoin wallet and maintained that he would settle his debts if he could access the funds. Terpin, who joined the hearing by phone, dismissed Truglia’s explanation as “a giant smoke screen.” The judge also criticized Truglia’s extravagant way of living, arguing that he lived in luxury even without a job.

Illicit crypto volume nearly hit $45 billion in 2024

Meanwhile, the crypto industry is still plagued by cybercrime. TRM Labs estimates that the illicit crypto volume was as high as $44.7 billion in 2024. According to their data, the TRON blockchain accounted for the majority of that activity—58%—followed by Ethereum 24%, Bitcoin 12%, and Binance Smart Chain and Polygon at 3% each.

Despite leading in illicit activity, TRON experienced the steepest drop in illicit volume among all blockchains analyzed — a $6 billion decline from 2023.  Nearly half of the tokens’ illicit volume was linked to sanctioned entities, and around 32% involved blocklisted funds. 

Overall, sanctioned entities accounted for the largest portion of illicit crypto volume, despite a 33% year-over-year decline in inflows. Over 85% of crypto inflows to sanctioned actors and regions were funneled through Garantex and Nobitex, the leading exchanges in Russia and Iran, respectively. However, both saw a drop in overall activity.

Additionally, there were about 5,635 publicly reported attacks in 2024, surpassing 5,223 in 2023. Ransomware payouts also hit new heights, including a record $75 million paid to the Dark Angels gang in March 2024.

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