Jun 07, 2024 12:25
Two individuals have filed a civil claim against HongKong-based cryptocurrency exchange JPEX, seeking to recover over HK$1.85million. This lawsuit is the first civil action related to an alleged fraudcase involving more than 2,600 victims with total losses amounting to HK$1.6billion. A lawmaker indicated that ten more victims plan to take similar legalactions.
Filing Lawsuit over Missing Funds
The plaintiffs, Chan Wing-yan and Herbert Lam, filed a writof summons in District Court against seven defendants, including JP-EX CryptoAsset Platform and Web 3.0 Technical Support. These companies allegedlyprovided virtual asset services under the JPEX brand since 2021.
Felix Chiu, avirtual asset manager at over-the-counter crypto exchange Coingaroo, andunidentified holders of three JPEX wallets are also named as defendants. According to the legal documents, Wing-yan registered twoaccounts with JPEX in July and August last year and opened a third account in Lamsname.
Wing-yans decision was influenced by seminars and promotional materialsfrom social media influencer Joseph Lam, who claimed to be a partner of JPEXand was arrested in September over conspiracy to defraud but has not beencharged.
During this period, Wing-yan transferred HK$850,000 and paidan additional HK$1 million in cash to Chiu to purchase Tether cryptocurrency(USDT) for her JPEX accounts. She also transferred 6219.6 USDT (HK$48,575) fromanother cryptocurrency platform to JPEX. The total deposits amounted to 247,498USDT (HK$1.93 million).
First Civil Lawsuit Filed Against #Crypto Exchange #JPEX for Alleged Fraud #NewsBytes https://t.co/9YFCJ1OZrV
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June 5, 2024Police Report 73 Arrests
The plaintiffs allege they were unable to withdraw theirassets after JPEX imposed a 99 percent withdrawal fee last September when theSecurities and Futures Commission identified JPEX as unlicensed. Theydiscovered their assets had been transferred to unknown wallets shortly aftereach deposit, leaving their accounts nearly empty.
The plaintiffs also stated they lacked access to the privatekeys necessary to manage their crypto-assets, which were controlled by thedefendants.
They have lodged three alternative claims, one seeking to recoverabout 226,013 USDT allegedly converted into other cryptocurrencies withoutauthorization. They have also requested the court to trace the assets and issuean injunction to prevent the defendants from dealing with them.
Police reported that 73 individuals had been arrested inconnection to the JPEX scandal, all of whom were granted bail and must reportto the police regularly.
This article was written by Tareq Sikder at www.financemagnates.com.
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