[2019-02-06] Locked bitcoins in QuadrigaCX might be another exit scam. - page 2.

dunfida

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Quote from: bbc.reporter on March 28, 2019, 11:33:07 PM

Another news update.

Whatever QuadrigaCX was, it is becoming clearer after every news update that it was not functioning only as an exchange. It was also something else. If it is proven true for QuadrigaCX, we can assume that it might be true for many of the other exchanges.

Theres no secret that can really be hidden forever. Truth would come out no matter what and as the day has passed out these updates do proves out on most peoples doubts about on this mysterious death of Cotten.

joniboini

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Wow, what a shock. Seems like the exit scam notion is becoming more and more plausible to explain their situation. The next one should be Bitfinex (Cryptocapital can't hide any longer).

bbc.reporter

legendary

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Another news update.

Whatever QuadrigaCX was, it is becoming clearer after every news update that it was not functioning only as an exchange. It was also something else. If it is proven true for QuadrigaCX, we can assume that it might be true for many of the other exchanges.

In a recent article published on CoinDesk, Christine Duhaime – a regulatory attorney in Canada who was hired by the exchange for a short period of time in 2015 – explained that Cotten was guiding his exchange down a precarious path long before his death.

Duhaime noted that her time at the company came to an abrupt end shortly after Cotten decided that he no longer wanted the exchange to be a listed company, which was directly proceeded by him firing all the employees that were, in his mind, “law and order” people.

“Gerald Cotten made the decision that he no longer wanted QuadrigaCX to be a listed company. On that day, he terminated the professionals that were, in his mind, the ‘law and order’ folks – the accountant, the auditor and me, the regulatory attorney,” she explained.

Furthermore, after this occurred, Duhaime explains that Cotten began running the exchange as if it has “no investors, no shareholders, no regulatory agencies and no law that applied to it – no corporate law, no securities law, no anti-money-laundering law and no contract law.”

Read in full https://www.newsbtc.com/2019/03/28/former-quadrigacx-attorney-claims-crypto-exchange-was-sent-down-path-of-lawlessness/

bbc.reporter

legendary

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News update.

@figmentofmyass. QuadrigaCX appears more revealed to be the moneylaundering part of a criminal operation as more details are being uncovered about this story hehehe.

Omar Dhanani

Quadrigacx Co-Founder Michael Patryn Is Actually Convicted Fraudster Omar Dhanani

While Dhanani, now known as Patryn, refused to comment on the matter, Bloomberg claims to have obtained records that confirm the man’s criminal past and his changing of names twice, in 2003 and 2008. Patryn co-founded troubled Canadian exchange Quadrigacx with the late Gerald Cotten in 2013.

Quadrigacx Co-Founder Michael Patryn Is Actually Convicted Fraudster Omar Dhanani
Omar Dhanani a.k.a Michael Patryn
He allegedly changed his name from Omar Dhanani to Omar Patryn with the British Columbia government in March 2003. The news agency reported that in 2008, Dhanani became known as Michael Patryn, having registered a new name in the same Canadian province.

In the U.S., Dhanani had been charged with several crimes, including pleading guilty to conspiracy to commit credit and bank card fraud in 2005, Bloomberg noted, quoting a statement from the U.S. Justice Department. He was just 22 years old at the time. Dhanani allegedly operated a website called shadowcrew.com, now defunct, peddling 1.5 million stolen credit and bank card numbers, claims the article.

Read in full https://news.bitcoin.com/quadrigacx-co-founder-michael-patryn-is-actually-convicted-fraudster-omar-dhanani/

Also, this is a clearer written article about the whole story.

https://www.crypto-news.net/quadriga-mystery-deepens-as-auditors-discover-cold-wallets-to-be-empty/

dreamhouse

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scary on what is going on, waiting for more information on it. In anyway the bitcoin fund management there seems suspicious.

bbc.reporter

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That might be correct. It is also possible that the bitcoin news media has been releasing clickbaits after clickbaits for our entertainment and their own interests hehe.

However, I still reckon that there might be more to the story. There is always more behind every story in the cryptospace hehehe.

figmentofmyass

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Quote from: bbc.reporter on March 15, 2019, 09:15:40 PM

However, why was QuadrigaCX sending 600k ethereum from cold storage to different exchanges? Why do that? I reckon this has already occured before the banks have frozen their accounts.

let's assume they were insolvent. in this situation, their entire operation depends on the inflow of crypto deposits. if they needed to cover USD or CAD or LTC withdrawals and didn't have the funds available, they could send BTC or ETH etc to kraken or binance, sell it and send back the proceeds to process customer withdrawals. if customer withdrawals were shut down entirely, the jig would be up pretty quickly.

bbc.reporter

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However, why was QuadrigaCX sending 600k ethereum from cold storage to different exchanges? Why do that? I reckon this has already occured before the banks have frozen their accounts.

figmentofmyass

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Quote from: bbc.reporter on March 14, 2019, 09:09:06 PM

@figmentofmyass. The frozen bank accounts might be because there was a suspicion of money laundering. However, instead of shutting down,or exit scamming, Gerald Cotten continued to deposit money to the exchange out of the goodness of his heart? I reckon he was using his personal accounts to launder money.

not out of the goodness of his heart IMO but out of self preservation. if the ponzi imploded like mt gox, he probably would have gone straight to prison for fraud, embezzlement, record tampering etc. so if there was no liquidity for customer withdrawals, he had two choices: come clean and face prison, or put in his own $$ in hopes that the CIBC funds would eventually be recovered. i guess he chose the latter and tried to keep the exchange afloat.

bbc.reporter

legendary

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@figmentofmyass. The frozen bank accounts might be because there was a suspicion of money laundering. However, instead of shutting down,or exit scamming, Gerald Cotten continued to deposit money to the exchange out of the goodness of his heart? I reckon he was using his personal accounts to launder money.

figmentofmyass

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Quote from: bbc.reporter on March 13, 2019, 09:52:15 PM

Another news update. Rest in peace Gerald Cotten, however this might be disrespectful of me to say. Quadriga is beginning to appear more like a small player in a bigger money laundering ring. I have said this before, however I believe it more now.

I reckon Gerald might not be trying to save the exchange's customers because he cared. He was personally laundering money using his personal account.

Jennifer Robertson, Cotten’s wife and executor of his estate, said in a statement sent to CoinDesk Wednesday that Cotten told her he was putting his own funds into the exchange after the Canadian Imperial Bank of Commerce (CIBC) froze its fiat holdings in 2018 over questions about their origin.

In the statement sent by law firm Stewart McKelvey, she said:

“While I had no direct knowledge of how Gerry operated the business, he told me that he had been putting his own money back into QCX to fund user withdrawals in 2018 while the CIBC money remained frozen. I believe Gerry had the best interests of the business in mind, and cared for his customers.”[/i]

it may have nothing to do with a bigger money laundering ring. he/they were apparently spreading thousands of BTC around to other exchanges---probably to buy/sell what they needed ($$ and altcoins) to cover customer withdrawals. maybe they got some bank accounts frozen because they were trying to move huge amounts of money in from foreign exchanges instead of transacting like a normal exchange would. with frozen fiat accounts (not to mention they were already slow-paying crypto depositors) it looks like cotten was just desperately trying to keep the exchange afloat.

Johnzky

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Quote from: bbc.reporter on February 06, 2019, 12:14:08 AM

.

Also, do not trade in small and unknown exchanges.

.

This is great advice specially to newbies and to the noobs whos seeking for something with cheaper fees,because most of the smaller exchangers that appears now are here to scam or even hacks us,so be careful in each exchanges we will engaging and better use those stable one even with high fees atleast you are secured and safer

bbc.reporter

legendary

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Another news update. Rest in peace Gerald Cotten, however this might be disrespectful of me to say. Quadriga is beginning to appear more like a small player in a bigger money laundering ring. I have said this before, however I believe it more now.

I reckon Gerald might not be trying to save the exchange's customers because he cared. He was personally laundering money using his personal account.

Gerald Cotten, the deceased founder and CEO of crypto exchange QuadrigaCX, used his own cash to make customers whole during a legal battle with a bank, his widow said.

Jennifer Robertson, Cotten’s wife and executor of his estate, said in a statement sent to CoinDesk Wednesday that Cotten told her he was putting his own funds into the exchange after the Canadian Imperial Bank of Commerce (CIBC) froze its fiat holdings in 2018 over questions about their origin.

In the statement sent by law firm Stewart McKelvey, she said:

“While I had no direct knowledge of how Gerry operated the business, he told me that he had been putting his own money back into QCX to fund user withdrawals in 2018 while the CIBC money remained frozen. I believe Gerry had the best interests of the business in mind, and cared for his customers.”

https://www.coindesk.com/stewart-mckelvey-quadriga-law-firm

veleten

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I won't be surprised if it is
where big money involved it is very easy to get seduced and plot something like that
the owner could be dead alright and he , probably is
but it I don't believe he hasn't planned a force majeur like this and hadn't prepared a backup
maybe the group of people who learnead about it could have killed him and orchestrated the whole scam
guess we will find out sooner rather than later

stomachgrowls

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Quote from: susila_bai on March 10, 2019, 05:16:14 AM

In India it is very easy to fake the documents or even fake the death news and create a real death Certificate. so that is why he came to India to do this exit scam. Why did he has to come to India when their is clear that cryptocurrency is not legal to use in India.

They do make things to be well arranged without even knowing that people can figure it out on what they are doing.They already know about India when it comes to fake events Grin

Lots of questions but we can already presume on his motive.

Quote from: o_e_l_e_o on March 10, 2019, 09:13:56 AM

Quote from: nutildah on March 10, 2019, 03:56:50 AM

Quadriga sends the BTC they bought with imaginary Quadbucks to personal addresses.

There's plenty of evidence that they were withdrawing customers' coins to deposit addresses on other exchanges, so they were clearly cashing out significant amounts of BTC they didn't own and converting it to fiat. Given that this went undetected for so long, I wouldn't be in the least bit surprised if it turned out they had been using Quadriga customers' KYC documents to fraudulently open accounts at other exchanges other their customers' names.

Most likely the case where if deposits do directly go into other exchange wallets then those documents have been submitted by customers itself would be used on the process.

There are already lots of obvious modus but this case has still no end or conclusion.

o_e_l_e_o

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Quote from: coolcoinz on March 10, 2019, 08:55:21 AM

It looks like they were emptying addresses before the owner "died".

8 months before he died, many of the so called "cold wallets" were emptied. This has been in the works for a long time, which is why they've managed to make off with such a large sum of money.

Quote from: nutildah on March 10, 2019, 03:56:50 AM

Quadriga sends the BTC they bought with imaginary Quadbucks to personal addresses.

There's plenty of evidence that they were withdrawing customers' coins to deposit addresses on other exchanges, so they were clearly cashing out significant amounts of BTC they didn't own and converting it to fiat. Given that this went undetected for so long, I wouldn't be in the least bit surprised if it turned out they had been using Quadriga customers' KYC documents to fraudulently open accounts at other exchanges other their customers' names.

coolcoinz

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It looks like they were emptying addresses before the owner "died". I read somewhere that they finished analysing the addresses and there were large withdrawals prior to his death, and that whole story about them not having private keys and funds still being on addresses is false.
Also, there's that thing with his wife taking money from the exchange after his death... It's obvious that this guy is hiding somewhere or maybe his wife emptied the addresses and hired some goons to take care of him in India.

susila_bai

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In India it is very easy to fake the documents or even fake the death news and create a real death Certificate. so that is why he came to India to do this exit scam. Why did he has to come to India when their is clear that cryptocurrency is not legal to use in India.

Baofeng

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I'm totally done with this QuadrigaCX issues/scams. I was one of those who open up a thread as pointed out by rdbase earlier and I still hold my opinion that the money is all gone and all those wallet are fictitious. And now it gets more juicier with what @nutildah, has posted and I'm sure that there's no way that account holders can get their funds, sorry to say.

nutildah

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This story gets juicier by the day.

Now it looks like they had created "fictitious" accounts to trade against customers funds, for the sake of pumping volume, as well as having a reason to move BTC to non-exchange related addresses. They also had their own unbacked CAD version of Tether, called "QuadBucks."

From reddit:

Here's what they were doing:

Customer deposits BTC;

Quadriga "artificially" creates a deposit of imaginary "Quadbucks" to their fake trading accounts;

Quadriga buys the customer BTC and shows in the customer account that they have Quadbucks;

Customer can't withdraw cash until actual customers deposit actual cash (because the "cash" that bought their BTC never existed);

Quadriga sends the BTC they bought with imaginary Quadbucks to personal addresses.

Topic: [2019-02-06] Locked bitcoins in QuadrigaCX might be another exit scam. - page 2. (Read 609 times)