Turkish consumers allege $2bn cryptocurrency frauds as Exchange CEO flees abroad

*About 390,000 active users of Turkish cryptocurrency Exchange Thodex allege fraud, as Police are searching offices of bourse following the CEO’s disappearance into thin air

Isola Moses | ConsumerConnect

Sequel to allegations stolen US$2billion, the Turkish cryptocurrency Exchange Thodex has ceased operations, and Faruk Fatih Ozer, Founder and Chief Executive Officer (CEO) fled the country.

A prosecutor in Istanbul has launched an investigation and police are searching the Thodex offices, the state-run Anadolu Agency reported.

The company in a statement earlier Thursday, April 22, 2021, said that the crypto trading platform is “unable” to continue operations with the CEO Ozer out of the country.

While not the largest Turkish crypto exchange, the shuttering of the platform has left the remaining assets of about 390,000 active users “irretrievable,” according to Oguz Evren Kilic, who represents an unspecified number of Thodex users and has filed a legal complaint on their behalf.

As authorities and consumers try to work out the details of what has happened, officials are calling for rapid regulation of the cryptocurrency market in the country.

A surge in the prices of digital tokens has been accompanied by convictions globally in scams tied to crypto platforms as well as speculation that authorities will seek tighter controls.

Cemil Ertem, Senior Economic Adviser to Turkish President Recep Tayyip Erdogan, told Bloomberg Thursday that the Turkish Government should take action “as soon as possible”.

Ertem said: “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.”

In relation to an alleged ‘hacking incident’, the CEO in a statement on the company’s Web site, had claimed that Thodex was unable to continue commercial operations after Ozer failed to transfer his “shares to another investor.”

Thordex Chief rather blamed the exchange’s financial woes on a “hacking incident” he said happened years ago.

He stated that the number of people who have investments in the exchange is “about 30,000.”

Ozer hasn’t responded to multiple calls to his mobile phone. Bedirhan Oguz Basibuyuk, the company’s lawyer, said he doesn’t know where Ozer is, but that he plans to return only after payments to all users have been made, report noted.

The Demiroren News Agency said he fled to Albania Tuesday, publishing what it said was a photo of Ozer at the airport.

When Basibuyuk asked Ozer why he went abroad, the response was that he would have been “either arrested or committed suicide” if he stayed, disclosed the attorney.

The Thodex attorney, who on phone described the situation as a “liquidity problem”, said “there was a decline in Thodex’s assets.

“When too many users demanded their money back, the company was unable to meet those.”

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