Huobi Accuses Former Senior Manager of Making $5M via Illegal Trades

Please fol­low and like us:
Pin Share

  • Chen Boliang report­ed­ly set up a Huo­bi retail account in his father’s name and pro­vid­ed it with $20 mil­lion in credit
  • Huo­bi ter­mi­nat­ed Chen’s employ­ment in May 2020, a spokesper­son told Blockworks

A one-time senior man­ag­er at promi­nent cryp­tocur­ren­cy exchange Huo­bi has been accused of rak­ing in $5 mil­lion in Teth­er (USDT) by secret­ly trad­ing against a com­pa­ny account under his control.

Chen Boliang, the for­mer employ­ee, is being pros­e­cut­ed in Hong Kong for the alleged trades made in Feb­ru­ary and March 2020, the Finan­cial Times report­ed on Wednes­day. Huo­bi was found­ed in Chi­na in 2014 but has since reg­is­tered in the Sey­chelles fol­low­ing cryp­to crack­downs in the mainland.

Chen’s employ­ment with Huo­bi Glob­al was ter­mi­nat­ed in May 2020, a com­pa­ny spokesper­son told Block­works. He was part of Huobi’s insti­tu­tion­al clients department.

“We have no fur­ther com­ments per­tain­ing to the charges against Mr. Boliang Chen and believe in the admin­is­tra­tion of jus­tice by the HK Spe­cial Admin­is­tra­tive Region,” they added.

Short­ly after his ter­mi­na­tion, Chen was arrest­ed on charges of using Huobi’s com­put­ers with crim­i­nal and dis­hon­est intent, as well as employ­ing the ille­gal pro­ceeds of $5 mil­lion in the sta­ble­coin USDT, the FT said, cit­ing Hong Kong court records. He faces sev­en counts in total.

A civ­il law­suit report­ed­ly filed by the cryp­to exchange shows Chen used his father’s name to cre­ate a Huo­bi retail account and pro­vid­ed it with a $20 mil­lion cred­it line direct­ly from the firm. 

The suit argues the for­mer employ­ee trad­ed against a Huo­bi cor­po­rate account that was under his super­vi­sion, moves that helped him pock­et $5 million.

Chen is set to face a mag­is­trate at a pre­lim­i­nary hear­ing next week, accord­ing to the FT. This would deter­mine whether the case holds suf­fi­cient evi­dence to go to tri­al. He’s cur­rent­ly free on a $25,000 bail, the report said, cit­ing a charge sheet. 

It isn’t clear how Huo­bi dis­cov­ered Chen’s alleged illic­it trades, but the exchange report­ed him to the police in April 2020. Huo­bi is cur­rent­ly the fourth largest cryp­to exchange in the world by trade vol­ume, behind Coin­base, FTX and Binance, hav­ing processed more than $1.3 bil­lion in trades over the past day, accord­ing to CoinGecko data.

Author­i­ties have been close­ly eye­ing the cryp­tocur­ren­cy sec­tor after its mete­oric growth over the past year. Ear­li­er this month, the Depart­ment of Jus­tice indict­ed for­mer OpenSea head of prod­uct Nathaniel Chas­tain on wire fraud and mon­ey laun­der­ing charges in con­nec­tion with NFT insid­er trading. 

An attor­ney for Chen didn’t imme­di­ate­ly return Block­works’ request for comment.


Get the day’s top cryp­to news and insights deliv­ered to your inbox every evening. Sub­scribe to Block­works’ free newslet­ter now.


  • Shali­ni Nagarajan

    Block­works

    Reporter

    Shali­ni is a cryp­to reporter from Ban­ga­lore, India who cov­ers devel­op­ments in the mar­ket, reg­u­la­tion, mar­ket struc­ture, and advice from insti­tu­tion­al experts. Pri­or to Block­works, she worked as a mar­kets reporter at Insid­er and a cor­re­spon­dent at Reuters News. She holds some bit­coin and ether. Reach her at [email pro­tect­ed]

Source link

Please fol­low and like us:
Pin Share

Leave a Reply

Your email address will not be published.