Turkish Crypto Exchange Under Investigation for Fraud
- The investigation of Thodex began only a week after the Turkish central bank announce it was banning the use of crypto for payments.
- It is alleged the company’s CEO fled the country only a day after the exchange halted crypto trading and withdrawals.
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Users of Turkish crypto exchange Thodex have filed a criminal complaint against the company’s CEO, alleging his disappearance could be part of an exit scam, local news outlet Anadolu Agency reported on 22 April.
According to the publication, the Turkish Public Prosecutor’s Office has already launched an investigation into the crypto platform after complaints from users who were unable to access their assets. A lawyer named Abdullah Usame Ceran has also filed a criminal complaint against Faruk Fatih Ozer, the CEO of Thodex, accusing him of “aggravated fraud”. The exchange first announced that crypto trading and withdrawals will be paused for six hours on Tuesday for maintenance, but later extended the period to 4-5 days.
The publication also stated that reports indicated that Thodex’s CEO has deactivated his social media accounts and has already fled the country, and remains out of touch. It has also been alleged the CEO stole close to $2 billion worth of crypto from the exchange, and left for Thailand through the Istanbul Airport only a day after Thodex locked its users out. According to Ceran, the exchange had close to 400,000 members, 390,000 of which were active.
The exchange, however, said the allegations were untrue, and only served as a “smear campaign”. Thodex assured their users they should not worry about their investments as the platform halted crypto trading and withdrawals due to “very serious partnership offers at the international level. The company said:
“Globally-renowned banks and funds, whose names we are going to announce when the agreement process is completed, have been wanting to invest in our company and proposed a partnership for a long time. For this process to be completed, transactions need to be halted and the sale process needs to be completed.”
The news came only a week after Turkey’s central bank announced it was banning the use of crypto for payments in the country. The new regulation — expected to come into effect on 30 April — will also prevent payment services from providing fiat on ramps to crypto exchanges in Turkey.
- The New York Jurors took 4 fours of deliberating before pronouncing the former FTX CEO guilty of all seven charges of fraud and conspiracy to commit fraud.
- Bankman-Fried will now have to appear in court on 28 March, 2024, where he will face a potential maximum sentence of 115 years in prison.
Former CEO of FTX Sam Bankman-Fried leaves the Federal Court in New York after pleading not guilty, 3 January, 2022.
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- Faruk Özer and his two siblings were sentenced to 11,196 years in prison for their involvement in the $2 billion rug pull of Turkish crypto exchange Thodex in 2021.
- Özer fled the country after the collapse of the exchange, but was detained in Albania a year later, and extradited back to Türkiye in April 2023 where he faced seven criminal charges.
- The U.S. Department of Justice has expressed its concerns over Sam Bankman-Fried’s seven expert witnesses, and requested they be barred from testifying on the case.
- The DoJ claimed most of the proposed experts lacked the necessary foundation for their opinions, making them unqualified to be an expert witness.