Farul Fatih Ozer, the founder and CEO of the now defunct cryptocurrency exchange Thodex, has been arrested in…
Founded in 2017, Thodex shut down abruptly in 2021, with Farul disappearing into thin air with the funds of thousands of investors. The Turkey-based crypto firm only informed its users that its platform has been “temporarily closed” to address an “abnormal fluctuation in the company accounts.”
With no ensuing statements regarding its investors’ funds, local media reported that Farul Fatih Ozer had flown to Albania, taking $2 billion of investors’ funds with him.
Demirorn News Agency published a photo of Farul leaving the international airport in Istanbul, leaving investors and users with funds in the exchange worried. A lawyer who had filed a criminal warrant against Farul informed the local media that Thodex had 400,000 users, of which 390,000 were active.
Following THDX’s collapse, the Central Bank of the Republic of Turkey banned the use of cryptocurrency for payments throughout the country in an attempt to curb the risks associated with the volatile assets.
Over time, other crypto exchange founders have absconded with their customers’ funds without prior fling or hint. The recent FTX collapse, which happened a year after Thodex, follows a similar pattern, and thankfully, Sam Bankman-Fried has been apprehended by regulators
Farul’s arrest comes as good news to the entire crypto community, which had been left infuriated by his denial of tens of thousands of their rightful funds, compounding the woes of an inherently fragile market.
Prosecutors want Thodex defendants to spend 40,564 years in jail
As earlier mentioned, the allegation was published by Demiroren and Hurriyet around a year after the platform ceased trading. The defendants are accused of forming a criminal organization, committing fraud, and laundering earnings from illegal acts.
The Turkish indictment claims 356 million Lira ($24 million) in losses. However, a Chainalysis assessment published in January estimated that the sum should be far higher—$2.6 billion. According to the blockchain forensics firm:
“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.”