Court passes sentence on a former Cryptopia staff for crypto fraud

Court passes sentence on a former Cryptopia staff for crypto fraud

An ex-worker of Cryptopia, a crypto firm that is currently inactive, has acknowledged being guilty of a crypto fraud that is worth approximately $172K, which he stole by duplicating the passwords of investors and used it for his criminal act. The crime was found out initially in September 2020, but not yet linked to the selling of the company’s assets the previous year.

Based on today’s broadcast by New Zealand news outlet Stuff, in Christchurch District Court, the anonymous Cryptopia ex-worker accepted that he was guilty of the fraud of over $1000, stealing from people’s funds under his control. He was judged by the court and will be censured on the 20th of October. According to a report, he once drew the attention of Cryptopia’s officials to the privacy of trader’s passwords, but later made a duplicate of the records and copied them to a USB flash drive. The firm still had crypto that is worth approximately $100,000,000 before selling off its assets two years ago, although the findings didn’t specify the actual time he copied the passwords or when he first had access to investors’ funds.

The fraud was discovered on 3rd September 2020 by David Ruscoe — a finance adviser at Grant Thornton. This happened when he observed that 13 BTC, which as of then was worth $165000, had been deducted from many wallets on the platform. The anonymous invader had also added 2 Bitcoin of the stolen reserves via a crypto mixer.

The culprit, when he disclosed his identity to Grant Thornton through an email, accepted that he stole the Bitcoin and extra crypto that is worth  $7000. He claimed to had refunded 6 Bitcoins and promised to pay back the remaining ones on the condition that he would be freed from litigation. Nevertheless, he was indicted afterward when he disclosed his crime to the police.

In line with Stuff, the synopsis of the events stated that the accused acknowledged that he was dissatisfied with the firm and also was incited by the thought that the old wallets would never be checked, hoping he would go scot-free.

Two years ago, Cryptopia experienced a major hack operation, losing cryptocurrency equivalent to approximately $16,000,000 to $18,000,000. Later on, Cryptopia discontinued its operation and sold its assets. Nevertheless, last year, it was resolved in a court that investors in the platform were entitled to regaining their lost holdings, and as at the time of publication, they have started the process of claiming their funds.



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