Earlier this year, popular cryptocurrency exchange BTC-e was taken down by authorities, following the arrest of 38-year-old Russian national Alexander Vinnik in Greece, for allegedly laundering $4 billion of ill-gotten bitcoins. Vinnik was seen as a “BTC-e operator” and his legal future is now thrown into turmoil.
Following Vinnik’s arrest, and taking into account BTC-e’s domain had been seized, users started believing their funds had also been seized by authorities and quickly reacted by creating a change.org petition to get their money back. It’s also been revealed that the exchange was fined for $110 million and that employees from a company called Mayzus Financial Services Ltd had been arrested for being tied to the illegal “money flow.”
At the time a BTC-e admin updated users on Bitcointalk and on Twitter about the exchange’s situation and revealed that they controlled over 55% of user funds and that the remaining 45% would be reimbursed through a Bitfinex-like token. The exchange then relaunched as World Exchange Services (WEX) and updated users on its current situation.
WEX clarified that it did receive digital assets from BTC-e, but not fiat balances or any financial obligations. It further updated users on the Bitfinex-like token situation:
“Earlier it was reported that the conversion will occur in the ratio of 55% (balances) and 45% (tokens). At the launch date, the ratio of 61.79% (Fiat and crypto) and 38.21% (tokens) became possible.”
In the past, the company stated that “funds will be returned to everyone.” Recently, however, several WEX users came forward stating that money they deposited into the exchange is seemingly stuck in limbo, as two companies tell them the other one has the funds.
On Bitcointalk, users claim that earlier this month, WEX started verifying the identity of fiat currency holders to refund them while complying with AML/KYC regulations. Following the process, users got an email CCN.com had access to, which told them to contact a third-party that reportedly handled their financial operations and was presumably in control of the funds: a company called Money Polo.
Money Polo, as the company’s website states, is a registered trademark of Mayzus Financial Services, the company in which some employees were allegedly arrested following BTC-e’s seizure.
After contacting the company, users were told that Money Polo received their money, and credited it to BTC-e, who may now seemingly be escaping the situation, as it is now WEX, an exchange that claimed not to “buy or accept any financial obligations form ex-BTC-e.”
In an attempt to get either WEX or Money Polo to further clarify the situation, users have been contacting these two companies in every possible way, but so far have only gotten the same answers.
In an organized attempt to retrieve their money, users started reaching out to various organizations, including Interpol, Europol, and FinCEN. So far, only Financial Ombudsman replied stating it contacted the companies giving them two months to provide a satisfactory answer.
One user told CCN.com that he hopes other victims will come forward. He added:
“We have filed complaint in several authorities website. We need to know: where is the money? Who locked the money? What do you need to do to unlock?”
Another user detailed that he deposited nearly $115,000 between July 21 and 24, right before BTC-e was seized by the FBI. Yet, he discarded the possibility of the U.S. government being in control of the funds as no information can be found on legal documents. He also pointed out that, if given the chance, he’ll prove the money was obtained in a legal way.
Affected users told CCN.com they contacted their banks in an attempt to retrieve their funds or know what happened to them. They were told Mayzus Financial Services received the funds and refused to send them back.
A user told CCN.com he believes BTC-e is selectively scamming some users so that only a few are unhappy and eventually give up on their cause after a few weeks. He stated:
“It’s selective scamming: 1) they scam some clients; 2) the clients complain for awhile; 3) most of them give up after few weeks; 4) easy profit. BTC-e always did this….but now they had the perfect situation to SCAM big money”
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Last modified: July 3, 2020 10:58 AM UTC