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Microsoft Engineer Gets 9 Years For Stealing $10M From Company

The defendant failed to hide his $10 million theft from Microsoft by using bitcoin.

A former Microsoft software engineer from Ukraine was sentenced to nine years in prison after stealing more than $10 million in store credit from Microsoft's online store.

The man, Volodymyr Kvashuk, took advantage of an oversight when tasked with testing Microsoft's online retail sales platform. Though the sales software automatically prevented testers like Kvashuk from shipping physical products, it didn't block the purchase of store credit.

This allowed the 26-year-old Kvashuk to steal $10 million with a view to reselling it online for his own profit.

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Stealing $10 million of store credit

Kvashuk tried to carry out what he thought was a watertight plan involving bitcoin. Between 2017-2018, the ex-Microsoft employee stole "currency stored value" (CSV) from his work platform in the form of digital gift cards.

He then proceeded to resell the CSV on the internet via a bitcoin "mixing" service in an attempt to hide the origin of the vast amounts of money entering his bank account.

In a particularly nasty move, Kvashuk even used test email accounts of other Microsoft employees to try to cover his tracks. The ex-Microsoft employee also filed a fake tax return claiming the money was a gift from a relative.

Over a period of two years, the defendant stole a total of $10 million in store credit. In the last seven months before being caught, he transferred $2.8 million in bitcoin to his bank account and purchased a $1.6 million lakefront home, and a $160,000 Tesla electric car.

'No sign of remorse'

Microsoft eventually became wise to what was happening — Kvashuk reportedly didn't hide his first attempts at stealing store credit — and fired the employee in 2018.

In February of this year, the Department of Justice wrote, via Entrpreneur.com, that Kvashuk was "convicted by a jury 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 furtherance of fraud."

In the sentencing memo to the Court, prosecutors said, "Kvashuk used the proceeds to live the life of a millionaire, driving a $160,000 car and living in a $1.6 million waterfront home. Kvashuk’s scheme involved lies and deception at every step. He put his colleagues in the line of fire by using their test accounts to steal CSV. Rather than taking responsibility, he testified and told a series of outrageous lies. There is no sign that Kvashuk feels any remorse or regret for his crimes."

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