Security Engineer Pleads Guilty to Nirvana Finance Exploitation and One Other Hacking Charge
A software engineer at Nirvana Finance and the decentralized cryptocurrency exchange pleaded guilty in New York's Southern District Court on Dec. 14 to computer fraud, the U.S. Attorney's Office said, for hacking smart contracts.
Shakib Ahmed, described as “Senior Security Engineer of a Global Technology Company” He was arrested in connection with the hacking of an unnamed exchange on July 2 and 3, 2022. Statement from the United States Attorney's Office:
“Ahmed attacked a crypto exchange by exploiting a vulnerability in one of the crypto exchange's smart contracts and entering false price information, causing that smart contract to generate an estimated $9 million in inflated fees.”
Ahmed “agreed not to report the attack to law enforcement” and returned all but $1.5 million to the exchange. The exchange “allowed users to exchange different types of cryptocurrencies, and paid fees to users who registered the currencies to offer the exchange on the crypto exchange.”
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It was only after Ahmed's arrest that he admitted to embezzling $3.49 million from Nirvana Financial's flash loans, later that month. Nirvana offered Twitter (now X) a $300,000 white hat to return the stolen funds.
Judge: How old are you? Shakib Ahmed: 34. I have BS from University of Illinois. Judge: Do you understand that you are changing your plea to guilty? Ahmed: Yes, the judge will take a break but will return. Thread continues below pic.twitter.com/9C6AlXnStA
— Inner City Press (@innercitypress) December 14, 2023
According to the statement, Ahmed and Nirvana Finance were hanging on to the offer, but Ahmed eventually sold all ANA coins for a profit, leading to the closing of Nirvana Finance.
“Ahmed used his technical expertise to steal over $12 million, converting stolen crypto to Monero, using cryptocurrency mixers, traversing blockchains and attempting to cover his tracks using overseas crypto exchanges.”
Ahmed, a US citizen and resident of New York City, was indicted in July and released on bail. He will be sentenced on March 13, 2024.
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