Crypto Exchange Error Sparks Legal Battle: User MIA After Receiving $328,000 Mistakenly

Crypto Exchange Error Sparks Legal Battle: User MIA After Receiving $328,000 Mistakenly

Crypto News – An Australian crypto exchange finds itself embroiled in a legal tangle as it endeavors to retrieve approximately $328,000 from one of its users following a significant error in fund allocation.

As per reports from ABC News, sourced from court documents, Rhino Trading, the parent company of the OTCPro exchange, mistakenly credited a user with $653,000 (equivalent to 995,000 Australian dollars) in January, a stark contrast to the intended $65,300 (99,500 Australian dollars) due to an internal oversight.

Subsequent attempts by the exchange to rectify the error were met with silence from the recipient, identified as Kow Seng Chai, who failed to respond to emails or attend court proceedings regarding the matter.

Allegations outlined in court filings suggest that Chai purportedly utilized a portion of the erroneously transferred funds to procure Tether and conducted withdrawals from the exchange in increments of $100,000, reaching a total withdrawal tally of approximately $626,700 (956,000 AUD) over a ten-day period.

Further complicating matters, Rhino Trading claims that a call made to the phone number associated with Chai’s account was answered by an individual disclaiming any affiliation with Chai. Additionally, Chai’s absence in court prompted the Supreme Court of Victoria to freeze his assets on February 9th and impose an injunction on February 21st, barring him from exiting the country.

Justice Michael Osborne, presiding over the case, emphasized the potential risk of asset dissipation and considered the dubious nature of presented bank statements when issuing orders to freeze Chai’s assets and prevent his departure from Australia.

Meanwhile, OTCPro calculates its loss at nearly $322,700, derived from deducting the sum of erroneously credited funds from Chai’s remaining account balance.

This incident evokes echoes of a similar mishap over two and a half years ago involving Crypto.com, where an erroneous transfer of $6.86 million (10.47 million AUD) was made to a Melbourne couple, Thevamanogari Manivel and Jatinder Singh, instead of a $100 refund. The couple, misconstruing the windfall as prize money, reportedly embarked on a lavish spending spree, acquiring properties, vehicles, and gifts for relatives.

Manivel was subsequently sentenced to an 18-month community corrections order in September 2023, while Singh awaits a hearing for his involvement in the case scheduled for March in a Melbourne court.