Cryptopia staff admit stealing $ 172,000 worth of cryptocurrencies

A former employee of the now-defunct crypto exchange Cryptopia pleaded guilty to theft of around $ 172,000 in crypto obtained from a copy of the platform’s users’ private keys.

According to a Monday story by New Zealand news agency Stuff, the anonymous Cryptopia agent pleaded guilty to theft and theft of more than $ 1,000 in Christchurch District Court. “from a person with a special relationship”, refer to cases in which a person appropriates the funds in custody. The court sentenced the employee, who will be sentenced on October 20.

The worker allegedly raised concerns about the security of users’ private keys to Cryptopia’s management and made his own copy of the information on a USB stick. Although it is not clear from the messages when he was able to copy the private keys or access the funds for the first time, Cryptopia was worth an estimated $ 100 million in cryptocurrency at the time of its liquidation in May 2019.

Cryptopia staff admit stealing $ 172,000 worth of cryptocurrencies
Cryptopia staff admit stealing $ 172,000 worth of cryptocurrencies

David Ruscoe, Partner for financial advice from Grant Thornton (the auditing company commissioned with the liquidation of Cryptopia) discovered the theft on September 3 when he discovered that 13 Bitcoins (BTC), valued at around 165,000 US dollars at the time, had been withdrawn from several wallets on the exchange. The unknown actor had also deposited 2 BTC of the stolen funds through a cryptocurrency mixer.

The former Cryptopia employee identified himself in an email with Grant Thornton a week later after receiving a tip-off from an employee allegedly admitting the stolen bitcoins and other crypto assets worth $ 7,000 to have. He said that he had already returned some of the coins (6 BTC) and offered to send the rest with assurances that he would not receive any criminal charges. However, he later admitted what he had done to the police and was subsequently charged.

“The defendant admitted that he was upset with Cryptopia but was also motivated by the belief that he could get away with the theft as he thought no one would check the old deposit wallets.” said the summary of the facts, according to Stuff.

The New Zealand exchange fell victim to a major hack in 2019 that allegedly resulted in a loss of around $ 16 million to $ 18 million in cryptocurrencies. Cryptopia then stopped its services and went into liquidation. However, a court ruled in May 2020 that Exchange users were entitled to the return of their holdings, and the complaint procedure has already started.

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