Crypto CEO Behind $2.5 Billion 'Rug Pull' Arrested, Faces 40,564 Years In Prison (pcgamer.com) 45
Faruk Fatih Ozer, the founder and CEO of the now-defunct crypto exchange Thodex, has been arrested in the Albanian city of Vlore. PC Gamer reports: Ozer fled following the collapse of Thodex in April 2021: he initially claimed a halt in trading was due to cyberattacks, and that investors' money was safe, before disappearing. Almost immediately afterwards, Turkish police arrested dozens of Thodex employees and seized the firm's computers. It subsequently emerged that, in April 2021, Thodex had moved approximately $125 million worth of bitcoin to the established US crypto exchange Kraken. Given the number of investors in Thodex left with nothing, this looks like straightforward theft from a failing business.
It's not the whole story, either. Cryptocrime analysis firm Chainanalysis addressed Thorex specifically in its overview of 2021, in the wider context of a total $2.8 billion worth of crypto scams over this year being 'rug pulls': wherein a seemingly legitimate business is set up, operates as normal for a while, then suddenly all the money is gone. It's large-scale fraud. "We should note that roughly 90% of the total value lost to rug pulls in 2021 can be attributed to one fraudulent centralized exchange, Thodex, whose CEO disappeared soon after the exchange halted users' ability to withdraw funds," says the Chainanalysis report. That works out at an estimate of around $2.5 billion of crypto.
Six people have already been jailed for their role in Thodex, including family members of Ozer, while 20 other prosecutions are ongoing. The Turkish daily Harriyet reports that state prosecutors are out to set an example: "A prison sentence of 40,564 years is sought for each of these 21 people, including Ozer, as over 2,000 people are included in the indictment as complainants."
It's not the whole story, either. Cryptocrime analysis firm Chainanalysis addressed Thorex specifically in its overview of 2021, in the wider context of a total $2.8 billion worth of crypto scams over this year being 'rug pulls': wherein a seemingly legitimate business is set up, operates as normal for a while, then suddenly all the money is gone. It's large-scale fraud. "We should note that roughly 90% of the total value lost to rug pulls in 2021 can be attributed to one fraudulent centralized exchange, Thodex, whose CEO disappeared soon after the exchange halted users' ability to withdraw funds," says the Chainanalysis report. That works out at an estimate of around $2.5 billion of crypto.
Six people have already been jailed for their role in Thodex, including family members of Ozer, while 20 other prosecutions are ongoing. The Turkish daily Harriyet reports that state prosecutors are out to set an example: "A prison sentence of 40,564 years is sought for each of these 21 people, including Ozer, as over 2,000 people are included in the indictment as complainants."
Surprise! (Score:5, Insightful)
Seriously: Is there a single person here who's surprised that all these "exchanges" are run by scammers?
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I am. Kinda obvious who the asshole is when something goes wrong. Like this. Maybe more folks will think twice before trying to get rich off of other folks money by stealing it. Do it the American way... invest it.
Re:Surprise! (Score:5, Funny)
I am.
Please PM me. I have some investments you might be interested in.
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Scammers gonna scam.
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Oh you'd be surprised. I'm 90% convinced Mt Gox was up to no good. Too much about that downfall doesnt add up
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Or a loss of focus. It was, after all a Magic the Gathering Online eXchange website used to trade Magic Online cards (yes, Magic the Gathering has an online game where players can trade virtual cards between themselves, and MtGox was a site expediting such things).
About the most real world experience something like that would have may be proxying payments between seller and buyer, though I'd really g
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Hanlen's Razor still applies, including the corollary that difference between malice and foolishness often don't matter to the fate of the victims.
Straightforward theft from a failing business? (Score:2)
No, more like straightforward fraudulent "business" where there was never any intent to return the money of "investors." It never was a real business of any kind.
Re: Straightforward theft from a failing business? (Score:2)
But this makes the politicians look good, swooping in like a superhero to save the day from ..?
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Politicians? I suppose, if you're calling the persecutors, politicians. Mr. Ozer deserves all the punishment that awaits him. He is a sleezebag who stole money on a grand scale, and does not deserve to be a free man.
hmm (Score:2)
The punishment should be based on the most negligent or intentional harm caused to any one individual, plus some additional time for scalable stupidity. It is cruel to total the punishments based on the number of victims. The only thing such revenge does is provide you with a dopamine hit of evil origin, it does nothing to help anyone.
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Re: hmm (Score:2)
I always get a laugh when fascists whine. They're so obsessed with strength because of their own impotence. These posts are basically every psychological trope on weakness and self-doubt packed into a tiny package that can fit into very small hands.
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Re: hmm (Score:1)
But fee fees got hurt. FEE FEES! Replacing a bored ape with a rug should get someone the chair!
Re: hmm (Score:2)
Oops, my mistake. I hear "rug pull" and "crypto" I think of the whole "Bored Apes" bruhaha.
Re: hmm (Score:2)
And the politicians will lose exactly 0 nights of sleep from this because they know thet got the public all nice and buttered up.
Re:hmm (Score:5, Insightful)
I'm struggling to understand the logic behind your position. By this logic, there should be no difference in punishment between murdering one person and committing genocide against millions, or robbing one person and robbing millions of people. The sentence may seem excessive in this case, but that's better than giving infinity-for-the-price-of-one bulk discounts on crime as you propose. Totaling punisments means the punishment scales with the damage caused instead. If you'd like to debate punitive vs. rehabilitative justice systems, that's another matter.
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Plus, if he's got 4,000 years in prison, it's ok if his sentence is reduced for good behavior. Cut it half even.
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By this logic, there should be no difference in punishment between murdering one person and committing genocide against millions, or robbing one person and robbing millions of people.
If you're going to hell because of one sin, why not make it 1,000 sins?
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The only thing such revenge does is provide you with a dopamine hit of evil origin, it does nothing to help anyone.
i cant think of a single legal system that doesnt have punitive elements
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"The Nazis should have only been prosecuted for one murder" is a hell of a take to post in public, but here you are making that very argument.
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"You are hereby sentenced to 40,000... umm 25,000... er, 32,000 years."
Clown time (Score:1)
Nice funny story posted here. But April Fools is a long ways off.
Re: Clown time (Score:2)
Again I though this was the "bored apes" exchange. But that many years in prison? Yikes. I heard that murderers often get less.
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I heard that murderers often get less.
It depends on how many people you murder.
Re: Clown time (Score:2)
Not everyone gets to win the game of life, and sometimes they get flat out hammered down into the cement. The world goes in like nothing happened.
Re: Clown time (Score:2)
The man in TFA has met such a fate and he will be forgotten as he slowly corrodes in his new god forsaken hell hole and passes away with no fanfare or mourning
It's more likely that he stole about 20 million (Score:5, Insightful)
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Pffttthhh... (Score:1)
40,564 years in a Turkish prison (Score:2, Funny)
Twice as much time as Aizen (Score:2)
Will he be blindfolded and strapped to a chair in a dark pit as well?
They should call it... (Score:2)
40,564 years in prison (Score:1)
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This is the most interesting bit of the story. What sort of life extension technologies have Albania got that they can get him through his sentence ?
Come on Albania, you should be sharing these breakthroughs with the rest of the world !
Well duh (Score:2)
Even the "legitimate" exchanges basically say there is zero regulatory protection when someone is screwed by a scammer, and so of course it keeps happening over and over. And describing any exchange as "legitimate" is kind of a misnomer when they're profiting by knowingly hooking up idiots with scammers.
Let them sink (Score:2)