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Huobi Accuses Former Senior Manager of Making $5M ​​Through Illegal Deals

  • Chen Boliang reportedly set up a Huobi retail account in his father’s name and provided him with a $20 million loan
  • Huobi ended Chen’s employment in May 2020, a spokesman told Blockworks

A former senior executive at prominent cryptocurrency exchange Huobi has been accused of raising $5 million in Tether (USDT) by secretly trading against a company account under his control.

Chen Boliang, the former employee, faces criminal prosecution in Hong Kong for alleged deals in February and March 2020 financial times reported on Wednesday. Huobi was founded in China in 2014 but has since registered in the Seychelles following mainland crypto raids.

Chen’s employment at Huobi Global ended in May 2020, a company spokesman told Blockworks. He was part of Huobi’s institutional clients department.

“We have no further comments on the charges against Mr. Boliang Chen and believe in the administration of justice by Hong Kong SAR,” they added.

Shortly after his release, Chen was arrested on charges of criminally and dishonestly using Huobi’s computer and using the $5 million illicit proceeds in stablecoin USDT, the FT said, citing Hong Kong court documents. He faces a total of seven charges.

A civil lawsuit reportedly filed by the crypto exchange shows that Chen used his father’s name to create a Huobi retail account and granted him a $20 million line of credit directly from the company.

The lawsuit argues the former employee traded against a Huobi company account that was under his supervision, moves that helped him rake in $5 million.

According to FT, Chen will face a judge at a preliminary hearing next week. This would determine whether the case contains enough evidence to go to trial. He is currently out on $25,000 bail, the report said, citing an indictment.

It’s not clear how Huobi discovered Chen’s alleged illegal dealings, but the exchange reported him to the police in April 2020. Huobi is currently the fourth largest crypto exchange in the world by trading volume, behind Coinbase, FTX and Binance after processing more according to CoinGecko Data.

Authorities have been keeping a close eye on the cryptocurrency sector following its meteoric growth over the past year. Earlier this month, the Justice Department indicted former OpenSea product manager Nathaniel Chastain with wire fraud and money laundering related to NFT insider trading.

An attorney for Chen did not immediately respond to Blockworks’ request for comment.

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The post Huobi accuses former senior manager of making $5 million from illegal deals is not financial advice.

Source: Crypto News Austria

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