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Ex-Microsoft engineer accused of digital currency scam

Ukrainian citizen, Volodymyr Kvashuk, has been accused of six counts of money laundering, five of wire fraud,  two of identity theft, two of filing false tax returns, and one count each of mail fraud, access device fraud, and access to a secure computer following a five-day trial, according to the US Department of Justice.

He worked as an employee and contractor at Redmond Giant. He worked as a software tester for Microsoft’s online retail platform from August 2016 to June 2018, where he misused his restricted access to embezzle digital assets including currency and gift vouchers. Kvashuk used his personal accounts and the email addresses of his co-workers to transfer digital assets. 

Initially, the software engineer stole relatively smaller amounts, reaching about $12,000 in value. However, the thefts soon proliferated to substantial percentages and Microsoft was ultimately swindled out of over $10 million over a period of seven months. With the amount stolen, the engineer purchased a lakefront home worth $1.6 million and a Tesla automobile.

Kvashuk was very cautious about concealing his trails. He used others’ accounts to reduce his chances of getting caught. He even employed cryptocurrency mixing services to clean his dirty funds before depositing them into his financial account, including $2.8 million in Bitcoin (BTC). This specific deposit was disguised as a fake gift from a relative through the filing of a fraudulent tax return. 

The scam was exposed and the engineer was instantly fired, leading to the criminal complaint. During the lawsuit, Kvashuk rejected any intention to defraud Microsoft; rather, he claimed he was “working on a special project to benefit the company.” This defense was termed a “house of lies” by the Prosecution officers. The jury also rejected Kvashuk’s explanation and sentenced him to 20 years in prison, which is set for June. 

Ryan Korner, the Special Agent Incharge IRS-CI, said that besides stealing from Microsoft, Kvashuk also robbed the government by concealing his fake income and filing false tax returns. He stated, “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.”