Hacked Crypto Exchange Breaks AML Laws

[image credit : Cryptopia]

Understanding the research of NZ Herald, liquidators from accounting giant Grant Thorton come up with new evidence of cryptocurrency exchange platform that Cryptopia allegedly failed to comply with the legal requirements at the time of managing trading accounts for new customers in Christchurch High Court. David Ruscoe, a liquidator from the accounting department states that he is presently associated with the New Zealand Police Department and the Department of Internal Affairs in current investigations on Cryptopia’s compliance of AML regulations.

According to the liquidators, the crypto exchange has not been allowed to access detailed information for some 933,000 active user accounts. Also, Cryptopia allegedly did not place trading limits on 44,000 early user accounts are about to hold $23 million in cryptocurrencies. Furthermore, only 9475 of Cryptopia’s 2.2. Million customers were localites of New Zealand. The remainder of the crypto exchange platform’s customer base is to spread across the major regions such as South Korea, U.S., Russia, Britain, Japan, Brazil according to the internet location addresses given by Google maps. Also, an unidentified number of user accounts allegedly hold over $3 million in crypto have been traced to uninhabited tropical islands near Australia. This has raised a few questions on Cryptopia’s adherence to Know-Your-Customer regulations for crypto exchanges.

The evidence which is officially filed by Grant Thornton liquidators is part of a four-day court hearing that was conducted on Tuesday to confirm the property of $250 million in crypto. Cryptopia traders are required to present more information to confirm their identity and comply with AML laws before receiving their crypto-assets, per resort.

Cryptopia is listed over 800 different digital currencies and virtual assets including Bitcoin and Ether which as a handsome experience to downward spiral suffering. The company made an announcement of major losses and the theft of $23 million worth of crypto. Less than a month, the crypto exchange witnessed suffering from another hack that pushed them to the loss of over 1675 ETH tokens worth about $16 million during the time report. Cryptopia relaunched in the year 2019 enclosing its crypto exchange platform with the providing of 40 secure trading pairs and promised to clear more coins for traders.

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