Microsoft engineer gets nine years for stealing $10M from Microsoft

A former Microsoft software program engineer from Ukraine has been sentenced to 9 years in jail for stealing greater than $10 million in retailer credit score from Microsoft’s on-line retailer. From 2016 to 2018, Volodymyr Kvashuk labored for Microsoft as a tester, putting mock on-line orders to ensure every little thing was working easily.

The software program routinely prevented cargo of bodily merchandise to testers like Kvashuk. However in an important oversight, it did not block the acquisition of digital reward playing cards. So the 26-year-old Kvashuk found that he may use his check account to purchase actual retailer credit score after which use the credit score to purchase actual merchandise.

At first, Kvashuk purchased an Workplace subscription and a few graphics playing cards. However when nobody objected to these small purchases, he grew a lot bolder. In late 2017 and early 2018, he stole thousands and thousands of {dollars} price of Microsoft retailer credit score and resold it on-line for bitcoin, which he then cashed out utilizing Coinbase.

Prosecutors say he netted no less than $2.8 million, which he used to purchase a $160,000 Tesla and a $1.6 million waterfront residence (his proceeds have been lower than the worth of the stolen credit score as a result of he needed to promote at a steep low cost).

Kvashuk made little effort to cowl his tracks for his earliest purchases. However as his thefts bought larger, he took extra precautions. He used check accounts that had been created by colleagues for later thefts. This was straightforward to do as a result of the testers stored observe of check account credentials in a shared on-line doc. He used throwaway e mail addresses and started utilizing a digital non-public networking service.

Earlier than cashing out the bitcoins, he despatched them to a mixing service in an try to cover their origins. Kvashuk reported the bitcoin windfall to the IRS however claimed the bitcoins had been a present from his father.

The federal government’s case

However the authorities’s grievance included fairly a little bit of proof linking Kvashuk to the crime.

He generally used the identical VPN connection—and therefore the identical IP handle—to entry completely different accounts, permitting investigators to attract connections between his recognized accounts and people used for later thefts. System fingerprinting methods additionally supplied circumstantial proof linking Kvashuk to the bigger heists.

The feds additionally argued that the timing of Kvashuk’s sudden bitcoin wealth was suspicious. “The worth of the bitcoin deposits to Kvashuk’s Coinbase account usually correlated with the worth of the bought and redeemed [Microsoft credit],” the federal government argued.

A jury discovered the federal government’s arguments convincing and convicted Kvashuk on a number of counts in February.

“Stealing out of your employer is dangerous sufficient, however stealing and making it seem that your colleagues are in charge widens the injury past {dollars} and cents,” US lawyer Brian Moran stated in a press launch. Kvashuk was convicted of “5 counts of wire fraud, six counts of cash laundering, two counts of aggravated id theft, two counts of submitting false tax returns, and one depend every of mail fraud, entry system fraud, and entry to a protected laptop in furtherance of fraud,” the federal government wrote.

Kvashuk has been ordered to pay $8.3 million in restitution, although it appears unlikely he’ll ever have the ability to do this. The federal government says he could also be deported after serving his time in jail.


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