The United States District Court in Seattle has convicted one Mr. Volodymyr Kvashuk, a former Microsoft software engineer yesterday of 18 felonies for a scheme to defraud the company of more than $10 million.
According to a report by the US Department of Justice, Kvashuk, 25, is a citizen of Ukraine. He had initially worked as a contractor and later as an employee in Microsoft where he worked as a software engineer between 2016 and 2018.
Kvashuk had reportedly been a software tester for the company’s online retail sales platform, where he used his position to steal digital assets including gift cards.
Using crypto mixers to stay anonymous
Initially, the amounts he stole using his personal account access were relatively little, about $12,000. However, the theft escalated to larger amounts and he employed various strategies to cover his tracks.
Being a software engineer, he was able to use the cryptocurrency mixing service to hide the source of the funds coming into his account. He also made use of accounts belonging to his colleagues to further his illicit activity.
He had channeled most of the money he stole into buying expensive things including a lakefront home worth $1.6 million and a Tesla car worth $160,000.
Kvashuk carried out this illegal activity for more than seven months, during which he defrauded Microsoft of over $10 million. He also transferred Bitcoin worth $2.8 million to his account, which he disguised by filing fake tax return forms, as a gift from his relative.
During his trial, Kvashuk denied having any intention of defrauding Microsoft, claiming that he was working on a special project that would benefit the company. This testimony was described by the prosecutors as “a house of lies on top of a previous house of lies.”
Kvashuk to face a twenty years jail term
He was convicted 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 his closing remarks, Ryan L. Horner, the IRS-CI Special Agent in Charge said, “in addition to stealing from Microsoft, Volodymyr Kvashuk also stole from the government by concealing his fraudulent income and filing false tax returns. Kvashuk’s grand scheme was thwarted by the hard-work of IRS-CI’s Cyber Crimes Unit. Criminals who think they can avoid detection by using cryptocurrency and laundering through mixers are put on notice…you will be caught and you will be held accountable.”
Kvashuk will be sentenced in June and he will face a prison term of up to twenty years.