Singaporean Malone Lam offered new plea deal by US government in US$260 million crypto heist case

SINGAPORE: Singaporean Malone Lam, who has been charged in the United States over a US$260 million fraud case, has been offered a new plea deal by the US government.

Lam was back in a US federal court in Washington DC on Tuesday (Nov 18) for a status hearing, a day after one of his alleged co-conspirators, Kunal Mehta, pleaded guilty to money laundering and RICO conspiracy.

RICO, short for the Racketeer Influenced and Corrupt Organizations Act, is a US law that allows prosecutors to charge individuals or groups involved in organised criminal enterprises.

Dressed in a dark green jumpsuit with the words “Alexandria Inmate" emblazoned on the back, Lam was calm and contemplative during the hearing, at times sifting through documents in front of him. 

It appeared he was still weighing whether to take a plea deal or have his case go to trial. 

Lam’s lawyer, John Patrick Pierce, said that he had received a new offer for a plea deal from the government on Sunday night, which he said he would “continue to address” with Lam and the Department of Justice attorney Kevin L Rosenberg. 

Mr Pierce did not go into the details of that new plea offer.

On Monday, he filed a motion to grant Lam access to a computer for discovery review. This is a pretrial phase in which opposing parties exchange information and evidence.

“The government has produced an extraordinary volume of electronic discovery in the captioned case, so much so that the Court has approved the use of a discovery attorney to facilitate with organisation and review of the electronic discovery,” Mr Pierce said in the filing.

“The volume is too unwieldy to be reviewed exclusively with counsel,” he added

On Tuesday, Judge Colleen Kollar-Kotelly approved the funds for the computer, which would have no access to the internet and would have to be used exclusively in the library of the Alexandria County Jail, where Lam is being held.

Discovery review could influence Lam’s decision on whether to accept a plea deal or go to trial. 

Prosecutors claimed Lam was the ringleader of a crypto-crime ring which duped victims into handing over passwords and other key information to access their online cryptocurrency accounts, then stealing their virtual assets and converting them into hard cash that was spent lavishly on things like exotic cars, expensive jewellery and handbags, as well as private jet and luxury home rentals. 

One of Lam’s alleged co-conspirators, Ethan Yarally, joined Tuesday’s status hearing via video. He was accused of being a “caller” for the enterprise. 

According to the government, the callers in this alleged crime ring pretended to be a security technician for well-known email providers like Google and Yahoo to dupe their victims into handing over access to their online accounts. 

Yarally’s lawyer Robert A Feitel said his client’s case was “likely to be resolved with a non-trial resolution”, adding that he was still in discussions with the government on a potential plea deal. 

Mr Feitel said he and Mr Rosenberg would discuss the matter later on Tuesday. 

Both Lam and Yarally are due back in court on Dec 17 for an update hearing. 

The judge said she expected to have a better understanding of “which direction this case will take”.