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July 21 US Justice Department arrested Former Coinbase product manager Ishan Wahi and his brother Nikhil Wahi have charged Sameer Ramani with wire fraud.
This fee was raised in connection with what the DOJ described as the “first ever cryptocurrency insider trading” scheme. Ramani is on the run from the authorities.
Damian Williams, United States Attorney for the Southern District of New York, said in a statement from the Justice Department:
“Our message on these accusations is clear. The scam is a scam, whether it happened on Blockchain or Wall Street.
And the Southern District of New York is relentless in bringing scammers to trial wherever they are. “
Allegedly, the defendant made “illegal transactions” in at least 25 different cryptocurrencies and earned about $ 1.5 million.
In a press release, the DOJ said that the value of cryptocurrencies “usually increased significantly” after Coinbase announced the potential listing of its assets. Therefore, Coinbase keeps all information related to the listing announcement confidential and prohibits employees from sharing such information or providing investment tips.
According to a press release, in October 2020, Ishan joined Coinbase as product manager for the asset listing team. According to the press release, Mr. Ishan had knowledge of the assets the exchange plans to list and when to publish them.
The DOJ claimed that between June 2021 and April 2022, Ishan leaked confidential information about the announcement of the coin list to his brother Nikil or his friend and fellow Ramani. Based on Ishan, Nikhil, or Ramani’s tips, you can use an anonymous Ethereum wallet to buy assets in advance and sell them for profit when prices rise after Coinbase’s listing announcement.
According to information provided by Ishan, Nikhil and Ramani used sensitive information from at least 14 Coinbase listing announcements, including at least 25 different assets, the press release said. To obscure the transaction, Nikil and Ramani used a centralized exchange account in the name of another to transfer funds and profits to multiple anonymous or new Ethereum wallets, according to the Justice Department.
Just before Coinbase announced on April 11, 2022 that it was considering listing a small number of tokens, a number of large-scale transactions were undertaken and investigations began, according to a DOJ statement. ..
On April 12, popular cryptocurrency personality Cobie tweeted that someone bought more than $ 390,000 in assets featured in Coinbase’s announcement just 24 hours before the list went public. Did. According to a statement from the Justice Department, the wallet transaction referred to by Coby was made by Ramani.
Coinbase began the investigation, during which the exchange’s security operations director sent an email to Ishan on May 11 and attended the interview directly on May 16. A plane to India scheduled to depart just before the interview.
However, Ishan mistakenly told his colleagues that he had already left for India on May 15, a DOJ statement said. He added that within hours of booking the ticket and arriving at the scheduled departure, Ishan called Nikil and Ramani about the Coinbase investigation and sent a message, sending a photo of the message received from the director of security operations. ..
Ishan was arrested by authorities before boarding the plane and was prevented from leaving the country.
The statutory maximum sentence for each count of wire fraud plots and wire fraud is 20 years. However, it should be noted that if convicted, the defendant’s judgment will be made by a judge.
SEC individual billing
The Securities and Exchange Commission (SEC), which supported the investigation, filed a civil suit against the defendant on July 21 on suspicion of securities fraud.
Coinbase is that blog:
“The assets listed on our platform are not securities. SEC claims are an unfortunate distraction from today’s appropriate law enforcement measures.”
