Crypto-fugitive who hid €13 million of client funds in Malta to face justice

An Albanian court on Monday ordered the extradition to Turkey of Thodex crypto exchange founder Faruk Fatih Özer.

As legal proceedings against the Turkish crypto pioneer get underway in Turkey, more light is expected to be shed on how Özer hid around €13 million of stolen client money in crypto wallets in Malta.

Özer is the founder of Thodex, which was one of Turkey’s largest cryptocurrency exchanges. He absconded in 2021 with millions of euros belonging to some 390,000 clients from across the country.

According to Turkish financial investigators, he hid at least €13 million of those funds in Malta-based crypto wallets. He then fled to Albania, where he was caught last year on the strength of an Interpol Red Notice.

An Albanian judge has now ordered his extradition on 3 May to Turkey, where he will face numerous charges and an incredibly lengthy prison sentence.

In an indictment by the Anatolian Chief Public Prosecutor’s Office, Özer is accused of defrauding hundreds of thousands of Thodex clients. The indictment follows an investigation conducted by MASAK – Turkey’s Financial Crimes Investigation Board, the country’s financial intelligence unit.

The MASAK report, reported by several media outlets in Turkey, found that Özer transferred client crypto assets worth a total of €13.2 million (253,714,909 Turkish lira) from three separate accounts to wallets at a crypto asset service provider in Malta.

Those crypto wallets, according to MASAK’s investigations, belong to Faruk Fatih Özer and co-defendants Cem Uzunoğlu and Zuhal Özer.

Özer had been on the run for over a year but was arrested in Albania in August on the strength of an Interpol Red Notice.

He will now face charges in Turkey of aggravated fraud and forming a criminal organisation.

The 27-year-old Özer’s Thodex exchange had inexplicably gone dark in April 2021 and thousands of users were suddenly left unable to withdraw their funds.  Özer then fled to Albania.

In all, over the past year Turkish authorities arrested 68 suspects, including Özer’s brothers, as part of their investigation.

The 268-page indictment singled out 21 defendants for charges of “establishing and managing an organisation for the purpose of committing a crime” and “fraud through using information systems, banks or credit institutions”, among other charges.

An incredible prison sentence of 40,564 years is being sought for each of the 21 defendants.

The Istanbul-based exchange had embarked upon aggressive advertising campaigns featuring famous Turkish models to lure investors in, at first promising them luxury cars in return for their business.

After the exchange went dark in April 2021, and when Özer and their funds appeared to have vanished, a number of users soon got themselves legal representation and filed a fraud complaint against the exchange and its executives.

The exchange announced at the time reporting a temporary shutdown due to “abnormal fluctuation in company accounts.”

Two days after absconding from Turkey last year, Özer denounced what he said were “baseless allegations” against him in a message posted on the company’s Twitter account. He said he had gone abroad to meet investors.

“I will return to Turkey in a few days and cooperate with the judicial authorities so that the truth comes out,” he said but never returned.