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Hong Kong authorities crackdown $155M money laundering ring

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Hong Kong Customs has reportedly put a stop to a significant money-laundering syndicate that involved the use of cryptocurrency.

Criminals have started to venture into the digital world, taking advantage of the fact that the crypto industry isn’t entirely regulated. However, authorities from across the globe have stepped up their game and made arrangements to deal with crimes involving the crypto industry. Hong Kong’s customs was one of them as they managed to disassemble a money-laundering syndicate that carried out a $155 million transfer.

The South China Post revealed that the police captured four men between the age of 24 and 33 for the same. This list included the leader of the syndicate along with the others that helped him out.

Hong Kong encounters its first crypto money laundering case

The money-laundering syndicate was reportedly started back in February 2020 and functioned all the way up to May 2021. A total of HK 1.2 billion had been illegally transferred through different bank accounts. About 60% of the funds were sent through bank accounts in Singapore.

The transaction pattern of the ring leader was what raised suspicion, which further instigated the investigation. Noting how this case was the first of its kind in the city, the Senior Superintendent Mark Woo Wai-kwan of customs’ syndicate crimes investigation bureau stated,

“It is the first time in Hong Kong that a money-laundering ring involved in using cryptocurrency to wash dirty cash and conceal the source of criminal assets was broken up.”

Furthermore, it was noted that those involved in the”Coin Breaker” case were employing the world’s largest stablecoin, Tether [USDT], to launder most of their funds. Around 40 wallets associated with the money laundering ring were found by the authorities during the investigation.

No cryptocurrency exchange’s name surfaced. The authorities hadn’t revealed what crypto platform was processing the illegal transactions carried out by the money laundering syndicate.

UK authorities nab crypto worth $250 million part of a money laundering case

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The crypto industry isn’t new to scams and hacks. As the UK has been doubling down on regulations, particularly with regard to the crypto-verse, the police in the region took down a money-laundering operation. They went on to confiscate a large sum of money.

The crypto market has been linked to an array of illegal activities, from being a part of the dark web all the way to money laundering and funding terrorism. Even though crypto platforms across the industry have been setting up robust anti-money laundering procedures, certain things go unnoticed in the industry.

Law enforcement does not lag as they keep up and bring down any bad actors in the industry. Similarly, UK’s Metropolitan Police revealed that they had come into possession of about $250 million worth of cryptocurrency.

UK’s largest crypto seizure yet?

Towards the end of June 2021, UK’s Met arrested a 39-year-old as a potential suspect of a money laundering case. While she was released on bail, the Met captured a total of £114million around the same time. As the world assumed that the sum as mentioned earlier would be their largest seizure in crypto, the Met went on to secure another £180 million worth of cryptocurrency on 10 July.

Noting how criminals have been taking their crimes digital, Deputy Assistant Commissioner Graham McNulty suggested that cash still remains king in the criminal world. He also revealed that the law enforcement agency had managed to bag “highly trained officers” to probe this territory.

As the investigation persists, the Deputy Assistant Commissioner added,

“The detectives on this case have worked tirelessly and meticulously to trace millions of pounds worth of cryptocurrency suspected of being linked to criminality and now being laundered to hide the trail. Those linked to this money are clearly working hard to hide it. Our investigation will stop at nothing to disrupt the transfer and identify those involved.”

Bithumb falls into troubled waters after Thai partner calls out exchange for fraud

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A popular South Korean cryptocurrency exchange, Bithumb, is slapped with a lawsuit by a former partner based in Thailand.

Cryptocurrency exchanges have found their way below the crypto spotlight. As more people flocked into the market, exchanges were kept busy all the time. The increased demand for crypto this year further agitated this trend. Moving over the surge in popularity, a major crypto exchange fell under the purview of Hong Kong officials for breach of contract as well as fraud.

Back in 2018, Bithumb had reportedly rolled out a platform in Thailand. This platform, however, did not garner any support from the exchange, further paving the way for immense damages to the Thailand firm. While the firm’s name remains under the wraps, it had decided to sue the South Korean exchange for backing out.

Bithumb could be sued for breach of contract

As per a recent report by the Korea Times, the Thailand partner has been prepping to sue Bithumb Global Holdings, GBEX, and the executives involved.

Even though the BXA coin never made the cut, it was speculated that the platform was trying to sell BXA coins through its Thai partner. The former Thai partner elaborated on the same and pointed out that once the exchange pulled the plug on the BXA business, the Thai platform became unnecessary. This further caused the closure of the Thai firm and also some “serious damage.”

The spokesperson added,

“BGH and GBEX collectively own a 49-percent stake in the joint venture in Thailand, and are wholly-owned subsidiaries of Bithumb Korea, so we sued Bithumb Korea’s executives last year and decided recently to file lawsuits in Hong Kong against the Hong Kong subsidiaries and their executives, who are related to this issue more directly.”

The BXA coin put the exchange in the wrong light. The Seoul Metropolitan Police Agency’s Intelligent Crime Investigation Unit officers even went on to raid the exchange’s headquarters in Gangnam back in September 2020.

Malaysian authorities nab four illegal crypto miners with 441 BTC mining machines

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Malaysian police have managed to take down a massive illegal mining rig that involved over 441 Bitcoin mining gears.

The crypto industry’s mining process has garnered a lot of attention over the years due to the rewards that come with it. The value of BTC has witnessed drastic growth particularly over the last couple of months and has even managed to amass the attention of the globe. With this, mining rewards have also observed an increase further enticing more individuals into it. This, however, comes with a lot of setbacks. While many have expressed concerns over the environmental damages caused by the whole mining process, governments across the globe have been worried about electricity thefts.

Malaysian illegal mining crackdown

The entire Bitcoin mining process consumes a lot of electricity making it difficult for just anyone to execute it. In the Malaysian state of Penang, authorities busted a crypto mining rig. The Malaysian police managed to seize a total of 441 machines that were used for mining cryptocurrencies. While these machines were worth a whopping RM180,000.

The police had reportedly carried out a total of four raids and managed to nab four suspects associated with the case. The George Town OCPD Asst Comm Soffian Santong elaborated on the same and stated,

“During the raids at Lintang Hajjah Rehmah, Jelutong, Sungai Dua, and Bayan Lepas, police also confiscated four computers, 11 routers, four modems, and 10 fans.”

The aforementioned suspects have been booked under the Section 379 and Section 427 of the Penal Code along with the Section 37 of the Electricity Supply Act 1990.

Furthermore, the police found that all the premises that were raided were stealing electricity to conduct Bitcoin mining activities. The Tenaga Nasional Berhad [TNB] had even endured losses up to  RM420,000.

While the person behind the entire plan is still on the run, the Malaysian police have been intensively searching for the person running this rig for the last couple of months.

BitConnect promoters face a lawsuit by SEC following a $2 billion crypto scam

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The Securities and Exchange Commission [SEC] of the United States has reportedly hit five people part of the BitConnect Ponzi scheme with a lawsuit.

The crypto-verse isn’t new to scams and hacks. However, the surge in the price of all the assets paved the way to more scammy projects that further led to several losing out on investments. While officials had shot down a crypto Ponzi scheme, BitConnect back in 2018, news pertaining to the platform has once again started to surface.

BitConnect makes headlines, once again

A platform started out in 2016 and urged customers to loan their cryptocurrency to garner massive returns. While BitConnect pocketed significant gains of about $2 billion, the FBI intervened in 2019 and looked for the victims of this scam. As this case persists, the SEC went on to file a lawsuit against five people, namely, Trevon Brown, Craig Grant, Ryan Maasen, and Michael Noble for promoting the Ponzi scheme.

The aforementioned individuals had reportedly formulated YouTube videos in order to recruit more people to be a part of the sham. Since the entire scheme was a multi-referral business, these promoters went on to earn a commission for bringing in more people.

Furthermore, this lawsuit was filed by the SEC in the United States District Court for the Southern District of New York accusing all five individuals of aiding the program.

Lara Shalov Mehraban, Associate Regional Director of SEC’s New York Regional Office, addressed the same in SEC’s recent press release and stated,

“We allege that these defendants unlawfully sold unregistered digital asset securities by actively promoting the BitConnect lending program to retail investors. We will seek to hold accountable those who illegally profit by capitalizing on the public’s interest in digital assets.”

While this platform hasn’t been functioning for a while now, the SEC hopes to garner  “injunctive relief, disgorgement plus interest, and civil penalties” through its latest lawsuit.

DeFi protocol developers pull an exit scam; siphons off with $32M

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DeFi has witnessed spectacular growth off late. While it does bring in limitless opportunities for the participants in the market, it also tags financial perils along with it.

in 2021 alone, exit scams in the decentralized finance space have increased at a worrisome pace. This time investors fell victim to DeFi100, a decentralized finance protocol built on the Binance Smart Chain. Reports alleged that the founders had run away with $32 million in investors’ funds.

The entities had posted a vicious message on the website which said: “We scammed you guys, and you can’t do shit about it”

DeFi100

DeFi100’s only clarification following the incident was a tweet in which it said their website was hacked yesterday and the message was written by the hackers. Shortly thereafter, the website showed an error 404 message.

Some speculated that several projects are bound to show their true colors as the bull season fades and hence it there could be a huge increase in exit scams over these next few months. One crypto analyst urged market players not to invest in projects that are very new, backed by anonymous teams, made as memes, and lack real utility.

Another twitter user and a community member who goes by the pseudonym ‘CryptoDragon‘ stated,

“After the dev scammed everyone and posted this picture on the site, some angry people found his internet footprints and exposed his real identity and location. The scammer has now been reported to Interpol and local authorities.”

Defi 100’s native token crashes

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After the developers absconded from the project, Defi 100’s native token, D100 took a plunge to its lowest value. According to CoinGecko’s latest chart, the defi coin was down by more than 25% which drove its price to $0.040, at the time of writing.

Meanwhile, crimes have become more pronounced in decentralized sector as they continued to boom while attracting bad actors. Along the same line, the crypto intelligence company CipherTrace had recently stated that while losses from cryptocurrency theft, hacks, and fraud declined sharply in the first four months of 2021, the same cannot be said about the defi ecosystem. The report stated that crime in the burgeoning “decentralized finance” space hit an all-time high.

Turkish Police Continue To Arrest More People In Thodex Crypto Exchange Case

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The Turkish government was seen dealing with an array of criminalities concerning the crypto-verse as it prepares to ban payments in crypto. However, the Turkish police did not fall back as they were quick enough to bag several suspects associated with the country’s most recent crypto fraud.

Last week, Thodex, a prominent cryptocurrency exchange in Turkey, suspended withdrawals for its users. This abrupt decision caused an immense commotion amongst its users. Right after this, the CEO of the platform, Faruk Fatih Özer, went missing which added to the unrest. Even though the CEO absconded, the police managed to detain over 83 people involved in the case.

Most recently, it was revealed that the officials had arrested about six individuals part of the case. This list included the siblings of the CEO who is still missing.

Turkish Authorities Bag Missing CEO’s Siblings

It was recently reported that six members were awaiting trial by the Turkish court. The CEO’s brother and sister Güven Özer and Serap Özer were also detained by the police as they reportedly had a huge role to play in the crypto exchange. Additionally, it was also noted that these members from the Özer family had notable crypto holdings.

The CEO’s sister Serap Özer, who also looked into the finances of the exchange, recorded transactions of about 120 million liras in her possession on the world’s largest cryptocurrency exchange, Binance. She outrightly shot down these claims and suggested that the account did not belong to her. The brother, Güven Özer did not have a major role in the platform but still held about 22 million Turkish liras.

Furthermore, Özer was seen boarding a flight to Albania from Istanbul which has caused Interpol to issue a red notice. Apart from Albania, Turkish authorities have sent out units to four other countries to look for the CEO. Speaking about the same, Interior Minister Suleyman Soylu said,

“When he is caught with the red notice, we have extradition agreements with a large part of these countries. God willing he will be caught and he will be returned.”

While this case has been taking different turns, the government of Turkey’s ban on crypto payments came into effect on Friday 30 April 2021.

Turkey Witnesses the Arrest of 62 People Involved in the Thodex Crypto Scam Case

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Turkey was one of the countries that decided to pull the plug on cryptocurrencies. The country went on to suggest that the country would soon ban any sort of payments in crypto. A few days after this announcement, a prominent Turkish cryptocurrency exchange, Thodex was called out by its users for looting them for over hundreds of millions of dollars. Just as this investigation was underway, the Turkish law enforcement nabbed over 78 people involved in the case.

Anadolu, a Turkish newspaper announced that the prosecutors involved in the case had bagged over 78 arrest warrants. However, only 62 were detained by the Turkish police.

Turkey Police Bag 78 Arrest Warrants

As per the report, it was noted that the Chief Public Prosecutor’s Office had issued warrants for over 78 individuals that were in contact with the Thodex. Furthermore, the Anti-Cyber ​​Crimes Branch Directorate went on to nab over 62 suspects throughout 8 provinces in Istanbul.

Along with the 62 people that were detained, the Turkey police captured several documents as well as digital materials pertaining to the case.

While the law enforcement has bagged these many suspects, the main person involved in the case, Fatih Faruk Ozer, the founder of the crypto exchange was still missing. Reports suggest that the founder had fled to Albania through a commercial flight from Istanbul. However, a complaint was filed against the CEO/founder Ozer over “aggravated fraud” by a Turkish lawyer, Abdullah Usame Ceran.

Furthermore, it was found that the cryptocurrency exchange’s website was still inactive, depriving users of the right to access their accounts and withdraw funds.

As Turkey prepares to impose a ban on crypto, the Thodex incident seems to have stirred up the country. However, Cemil Ertem, the senior economic adviser to the President of Turkey said,

“Turkey will undoubtedly carry out a regulation that’s in line with its economy but also by following global developments.”

Turkish Crypto Exchange Users Succumb to Losses After CEO Absconds

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Just days after the Turkish central bank announced a ban on cryptocurrency payments, users of a prominent crypto exchange in the country faced a catastrophic loss.

As per a recent report, the users of the Turkish cryptocurrency exchange, Thodex had trouble withdrawing their investments. While the exchange hoards about 400,000 users, investments of about hundreds of millions of dollars were reportedly stuck in the exchange. After these users decided to go the legal way, they discovered that the CEO of the platform was missing.

Turkish Govt Should Take Action ASAP Urges President’s Economic Adviser

The users of the crypto platform, Thodex went on to file a complaint against the exchange for fraud. While a prosecutor from Instanbul went on to carry out an investigation of his own regarding the case, funds worth over hundreds of millions of dollars were still stuck in the exchange, Oguz Evren Kilic, the representative of the Thodex users asserted.

The users were alarmed after the platform decided to pull the plug on its services for five days citing maintenance as a reason.

Amidst this, the founder and chief executive officer, Faruk Fatih Ozer had reportedly absconded from the country. He took off from Istanbul on a commercial flight from Istanbul and is speculated to have gone to Albania.

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A photo of the CEO was captured during his departure from Turkey. While the CEO is not answering his phone, the search for him continues.

Urging the Turkish government to take timely action, Cemil Ertem, the senior economic adviser to Turkey’s President Recep Tayyip Erdogan, stated,

“Pyramid schemes are being established in this area. Turkey will undoubtedly carry out a regulation that’s in line with its economy but also by following global developments.”

Not long ago, the Central Bank of the Republic of Turkey announced that any direct or indirect payments in crypto would be considered illegal. This law would be effective starting from 30 April.

Paxful Users’ Data Is Safe, Affirms CEO Youssef

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The users of the prominent cryptocurrency exchange, Paxful was recently subject to extreme angst as rumors pertaining to a data breach on the platform surfaced. However, the CEO of the exchange asserted that the platform was safe and had experienced no such thing.

The emergence of digitalization with regard to the financial sphere is promising, however, quite often platforms associated with this fall prey to hacks and attacks. While the crypto industry has witnessed an array of hacks, an online market, Raid Forums solely for the purpose of selling and buying of stolen data has been established. A user of the Raid Forum reportedly claimed to have personal data of over 4.8 million Paxful users. This included names, email addresses, gender, phone number, birth dates as well as passwords.

Recently, social media giant, Facebook had also experienced a data breach. However, in this case, the seller, who used the name, Mafufi demanded 1 Bitcoin [BTC] which was about $60K, during the time of writing.

The news about the exchange being hacked gave rise to another conversation that emphasized the emergence of these hacks despite Know Your Customer [KYC] and Anti-Money Laundering [AML] procedures. Addressing the same, the CEO of Paxful, Ray Youssef said,

“Neither does Paxful. Any KYC data is never on our servers. We don’t take asking for people’s identities lightly. Good news soon”

Paxful CEO: “Ignore the FUD”

While this caused unrest in the crypto community, the CEO of the platform, Ray Youssef restored hope by affirming that no user data was leaked. His tweet read,

“All funds and Identities are Safe @paxful No user data was leaked, no breach was ever made of our users! Ignore the FUD! long live #bitcoin The data they had was old employee records from a payroll site we no longer use. #badguysdontwin”

Furthermore, the users of the exchange were put at ease post this tweet.