Bank of Thailand: Cryptocurrencies Are Not To Blame For Recent Bitcoin Fraud Case

  • Bank of Thailand's governor has clarified that the recent bitcoin fraud case involving Thai actor Jiratpisit Jaravijit had nothing to do with "crypto trading."
  • The governor also noted that the $24 million bitcoin scam was a case of "misuse of money."
  • Three major banks in Thailand are suspected of being involved in the bitcoin fraud case.

Thailand’s central bank recently issued a statement regarding the fraud case involving Jiratpisit Jaravijit, a Thai actor who allegedly swindled a Finnish investor out of $24 million in Bitcoin (BTC). The nation’s central financial institution, Bank of Thailand (BoT), clarified that although the fraud was a serious crime, it did not occur “during crypto trading.”

Veerathai Santiprabhob, the governor of BoT, noted that the bitcoin scam was a case where “the money is used for the wrong purpose.” The high-profile fraud case is now being investigated by Thailand’s Crime Suspension Division (CSD) as eight suspects including Jaravijit, his family members, two local businessman, and an ex-military officer were interrogated by the authorities on Thursday.

Major Banks "Complicit" In Bitcoin Fraud

According to local news reports, Thailand’s three major banks including Kasikornbank, Bangkok Bank, and Siam Commercial Bank “are suspected of being complicit” in the bitcoin fraud case. A “whale” investor named Prasit Srisuwan, who works at the Stock Exchange of Thailand (SET), might also have been involved in the scam, media sources noted.

Additionally, CSD’s investigation revealed that the whale investor and the banks “handled transactions involving part of the swindled money.” Local authorities added that several employees working at the banks did not report many transactions of over 2 million baht ($61,000).

Failure to report such transactions is a major violation of Thailand’s anti-money laundering laws, the the Bangkok post noted. Despite the serious nature of this recent bitcoin fraud, Thailand’s government considers it to be a case mainly involving the “misuse of money” and not necessarily related to its local crypto industry.

Progressive Crypto Regulations

As CryptoGlobe reported, Thailand’s Securities and Exchange Commission (SEC) legalized seven cryptocurrencies in June for initial coin offerings (ICOs). They include Bitcoin (BTC), Bitcoin Cash (BCH), Ethereum (ETH), Ethereum Classic (ETC), Litecoin (LTC), Stellar (XLM), and Ripple (XRP).

Additionally, Thailand’s SEC gave the green light to seven local crypto companies, which included five digital currency exchanges, to conduct business operations in the country. At present, the nation’s regulators are in the process of reviewing various other crypto-related applications.

More recently, as CryptoGlobe reported on August 5th, the BoT authorized all local banks to launch subsidiaries, which may provide certain banking services to digital currency investors. These services include offering brokerage services to crypto firms and investing in blockchain startups. The banks’ subsidiaries were also authorized to operate their own crypto businesses.

$3.1 million: Crypto Exchange Cashaa Hacked for 336 BTC

London-based cryptocurrency exchange Cashaa revealed it lost 336 bitcoin, at press time worth $3.1 million, to hackers who managed to access one of its cryptocurrency wallets.

According to a tweet the exchange published on July 11, the attackers managed to access one of its wallets, and quickly transferred the funds to an address they control. From the address they went to the BTC has been through a series of hops, suggesting the use of coin mixing software to limit traceability and throw off blockchain sleuths.

Cashaa believes that the attacker may have managed to infect one of its computers with malware, and then waited for an employee to access its machine. As soon as that happened, the funds were moved out of its wallet. Reacting to the security breach, the exchange halted withdrawals and deposits and “called the board meeting to decide whether the company will bear all the losses.”

The exchange suspects the hacker is from east Delhi, India, and filed a report with the Delhi police cybercrimes department.

Cashaa also reached out to other cryptocurrency exchanges and businesses informing them of the address, in a bid to stop the hacker from cashing out. In statements provided to industry media Kumar Gaurav, Cashaa’s CEO, seemingly lashed out at trading platforms that allow hackers to cash out.

Gaurav was quoted as saying:

As of today, hackers are very confident to hack crypto addresses and move it through exchanges that are facilitating such laundering through their systems. Exchanges like these must be shut down and owners of these exchanges should be charged with money laundering facilitation crime.

CryptoCompare’s Exchange Benchmark report, as recently reported, revealed that 38% of crypto exchanges interact with high-risk entities in 25% or more of their transactions. High-risk entities are those associated with darknet markets and vendors, criminals, gambling projects, malware operators, and others.

Featured image by Kevin Ku on Unsplash