A couple from Melbourne is slated for a plea hearing in October over accusations of theft following an accidental transfer of 10.5 million Australian dollars ($6.7 million) into their account by Crypto.com in 2021.
Upon mistakenly receiving the substantial sum, the pair promptly began spending the funds, only for the error to be detected later on.
The mishap transpired in May 2021 when Thevamanogari Manivel attempted to transfer funds to her partner, Jatinder Singh’s account on Crypto.com. Due to a discrepancy, where the bank account details did not align with the exchange account, Crypto.com initiated a refund.
However, rather than receiving a refund of AUD $100 ($67), the system erroneously transferred a whopping AUD $10.5 million (equivalent to over $7 million) to the unsuspecting couple in Melbourne.
The error escaped detection until December 2021, when Crypto.com undertook its yearly financial audit.
In response to this startling discovery, the exchange initiated legal proceedings in the Victoria Supreme Court, demanding the restitution of the misallocated funds.
However, the couple countered, claiming they had already expended the lion’s share of the windfall.
Their expenditures reportedly encompassed the acquisition of four properties, various vehicles, and a multitude of other items. Notably, a sum nearing 4 million AU$ was also transferred to a bank in Malaysia.
In light of these events, the court mandated the liquidation of one of their acquisitions: a five-bedroom residence in Craigieburn valued at 1.35 million AU$. The resulting funds from this sale were decreed to be reimbursed to the exchange.
Couple Claim they Believed they Won a Prize
During the court hearings in October 2022, the duo posited that they had assumed the substantial sum was a reward from the crypto platform.
Singh maintained that he had been alerted about a potential contest through a notification from the exchange in the past, leading him to believe the funds were a legitimate prize.
However, Michi Chan Fores, the compliance officer for Crypto.com, firmly debunked Singh’s assertion. Fores stated that the platform never disseminated such prize-related notifications to its user base.
Fast forward to September 2023, Manivel acknowledged her indiscretion by entering a guilty plea for recklessly handling the ill-gotten gains.
The court imposed an 18-month community corrections order on her. This order mandates her to undergo six months of rigorous compliance and contribute unpaid services to the community.
Singh, on the other hand, is slated to present his defense in a plea trial scheduled for October 23.
Crypto.com, evidently, has had a history of transactional oversights.
In the preceding year, specifically in October, the platform inadvertently transferred a massive sum of 320,000 ETH (valued approximately at $400 million at that time) to a wallet associated with Gate.io.
Kris Marszalek, the CEO of Crypto.com, elucidated that this hefty transaction was intended as a transfer to a new cold storage facility. However, due to an error, it ended up in an externally whitelisted exchange address.
In the wake of this blunder, Marszalek stated, “We collaborated with the team at Gate.io, leading to the successful retrieval of the funds, which were redirected to our cold storage. In light of this, we’ve fortified our procedures and incorporated additional measures to forestall such mishaps in the future.”