A court in Turkey has jailed six individuals suspected to be connected with the fraud scams allegedly committed by the Thodex trading platform. Among them, the brother and sister of Thodex CEO and founder Faruk Fatih Özer.
An estimated 83 people have been detained as part of a probe into Thodex’s suspected fraudulent dealings. Most, who were arrested across eight provinces of Turkey, have been released. Some with judicial control measures. However, six, including the founder’s siblings, have been imprisoned pending trial, as reports indicate.
The scams came to light after an unusual message appeared on the Thodex website. It read that the site would be down for four or five days. However, users soon found themselves unable to withdraw their funds from the platform. And then it emerged that company founder Faruk Fatih Özer had flown to Tiranë, Albania. Absconding with an estimated $2 billion in stolen funds.
Reports indicate that Thodex defrauded nearly 400,000 users in the scam. However, Özer has since denied this figure in an online message, posted from an unknown location.
Since then, the 27-year-old has remained at large and in hiding. An international hunt was launched for the businessman, with units sent to four countries in search of Özer.
In a similar but separate incident, the Turkish authorities also arrested four people on April 26, under fraud allegations in connection with another exchange, Vebitcoin. More specifically, the exchange’s founder İlker Baş, plus his wife and two employees. This occurred only days after it was revealed Vebitcoin would be shutting down, citing financial difficulties as the reason.
Developments in the Turkish crypto climate
It is no secret that restrictions on cryptocurrency trading have been tightening in Turkey over the past few weeks. In the middle of April, The Central Bank of Turkey announced they were outlawing crypto payments. This is in the midst of a so-called “digital asset boom”, which the country’s authorities believe could risk non-recoverable losses. On account of the anonymity behind crypto transactions.
The ban officially went into effect on April 30th. Directly following that, reports have revealed that cryptocurrency providers must abide by anti-money laundering and terrorism financing regulations. Crimes such as tax evasion and terrorist financing were among the reasons Turkish authorities called for more regulation on cryptocurrency. Beforehand, those authorities demanded that crypto exchanges and trading platforms hand over their customers’ information.
Reports indicate that enforcing this will make it easier for financial watchdogs in Turkey to carry out investigations.
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