Crypto Boss Jailed for Failure to File Tax Documents

A Turkish court has sentenced Thodex founder Faruk Faith Özer to seven months and 15 days for failing to submit tax-related documents to the Tax Inspection Board.

The Anatolian 17th Criminal Court of First Instance handed down the sentence via a conference call with Özer on Tuesday.

Thodex Founder Failed to Produce Tax Documents

Özer failed to produce documents he maintained he had no access to after the exchange filed for bankruptcy. The court reduced his original sentence from five years to one year and six months and later revised it to seven months and five days after reviewing his behavior and social connections after the crime.

Turkish tax authorities flagged Özer for not sending documents within a legal timeframe in 2021 even as the founder faced accusations of allegedly defrauding Thodex customers. He was later placed on Interpol’s Red List and extradited from Albania to Turkey on April 20.

The former crypto boss suspended the exchange’s operations in April 2021 following a “partnership offer.” He denied claims the company lost customer funds, instead claiming the company sought outside investment after seeing abnormal behavior in company accounts.

Authorities later arrested Özer’s siblings for their alleged involvement in the fraud.

Extradition Wars a Growing Feature of Crypto Fraud Cases

Several crypto founders have found themselves facing extradition to answer allegations of fraud. The borderless nature of crypto has raised questions about who should police criminal activity.

On Monday, the Group of 20 Financial Stability Board released global recommendations for crypto exchanges. These new guidelines came at the request of prominent global leaders to set a universal standard for crypto businesses.

Montenegrin authorities arrested Terra Luna founder Do Kwon Korean after authorities asked Interpol to place him on a red list last year. South Korean and US authorities are seeking his extradition on fraud-related charges, but it is unclear which country Montenegro will favor.

Learn how to keep your crypto safe from fraud here.

Kwon’s lawyers have argued the US Securities and Exchange Commission had no authority to charge Kwon earlier this year.

Last year, FTX co-founder Sam Bankman-Fried volunteered to be extradited to the United States after authorities in the Bahamas arrested him. He is currently awaiting a criminal trial that will take place in October.

US authorities initially questioned the ability of the Bahamas to unravel the intricate web of Bankman-Fried’s business activities.

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