Fraud and Scams, News & Updates

Primary Crypto Fraud Case In Australia – Filed In Federal Court

A cryptocurrency fraud case has been filed to the Federal Court of Australia in what is considered to be a first for Australian law. Alexandre Raffin accuses Modern Assets Australia and its directors Jonathan Allison and Carlo Sciubba of breaching their care duty.

Modern Assets Australia is a Gold Coast-based investment company that trades in cryptocurrency. Raffin understands this alleged breach resulted in him being scammed out of $93,000.

Let’s dive deeper into the case.

Alexandre Raffin v Modern Assets Australia Pty Ltd & ORS

AS claimed by ABC News, Raffin approached Modern Assets to purchase South Korean cryptocurrency, Klatyn.

Purportedly, a discrepancy between the two parties suggested the deal fell through. Raffin alleges that Modern Assets then put him in touch with its supplier of Klatyn.

After communicating with the supplier, Raffin states he handed over $93,000. This amount was to be exchanged for 937,000 units of Klatyn. Instead, the person disappeared with Raffin’s money.

Raffin runs a brokerage firm called GAINS Associates. He says the money lost, in what he considers a scam, belonged to his firm’s clients. Due to this, Raffin paid the clients back from his pocket.

He told ABC News he is now seeking to recover the $93,000. Besides, Raffin is seeking an additional $800,000 as that would have been the cryptocurrency’s worth in August 2020. 

A spokesperson from Modern Assets also spoke to ABC News, saying the investment company denies and will be defending all allegations.

Australian national charged with securities fraud in New York

This is the first cryptocurrency fraud case on Australian soil. However, an Australian was charged with fraud over his cryptocurrency investments in the United States.

In February this year, Stefan He Qin was charged with one count of securities fraud. Furthermore, he pleads guilty in a Manhattan federal court.

Qin was found to have taken money from a cryptocurrency-based investment fund he owned. He was using it for personal expenses and investments. He then faked data to investors into believing their cryptocurrency investments were gaining in value.

All up, Qin was found to have scammed over US$90 million.

Cryptocurrency scams on the rise

According to the Australian Securities and Investment Commission (ASIC), COVID-19 brought a rise in cryptocurrency scams targeting Australians.

ASIC reportedly saw a 20% increase in Australian’s becoming victims of cryptocurrency scams. It warns that recovering money from cryptocurrency scams is particularly difficult and rarely successful.

The Australian Government has created a resource for those worried about cryptocurrency scams.

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