Head of Collapsed Crypto Exchange Thorex Arrested in Albania

According to a statement made by the Turkish Ministry of the Interior on Tuesday, a Turkish businessman named Faruk Fatih Ozer, Thorex CEO, who was wanted by the Turkish authorities on charges of orchestrating a cryptocurrency hoax, was apprehended in Albania and is currently awaiting extradition to Turkey.

Ozer, who is only 28 years old and is the CEO of the cryptocurrency exchange Thodex, is accused of perpetrating one of the greatest financial hoaxes in the history of Turkey’s contemporary economy. Ozer is accused of fleeing the country with over $2 billion in assets belonging to investors, despite the fact that he has disputed the allegations via social media numerous times and that Turkey has issued a “red notice” for his arrest through Interpol in April 2021.

The Albanian Interior Minister, Bledar Cuci, personally called his Turkish counterpart, Suleyman Soylu, this morning to inform him of the arrest that took place as a result of an operation known as “Brain.” This was the announcement that was made today by the Ministry of the Interior. Al-Monitor has been informed by security sources that two Albanian citizens who helped the wanted Turkish national have also been captured.

Kreshnik Ajazi, the public prosecutor in the city of Elbasan, where Ozer was brought after being caught in the town of Vlora on the coast, has verified the arrest. According to statements made by Ajazi to the Balkan Investigative Reporting Network, Ozer will initially go through the hearing procedure in Albania, and the extradition process will begin after that.

Turkish government sources have stated that they do not anticipate any difficulties with the extradition.

According to data provided by CoinMarketCap, the cryptocurrency exchange platform known as Thodex, which described itself as Turkey’s first globally recognized crypto exchange platform, had seen more than $585 million worth of transactions take place on its platform before it was shut down in April 2021. Ozer, who has a youthful appearance and is appealing to the media, has made frequent appearances on national television to discuss cryptocurrencies and financial instruments.

Investors were sought after by Thodex by glitzy advertisements broadcast on television and social media campaigns that included national superstars such as the actress Gokce Bahadir, who played the female lead in the Netflix hit film “The Club,” and the economist Ercan Oz. After the business was shut down, a number of famous people were probed for possible involvement in the plan, but they were ultimately exonerated.

The ambitious marketing campaign was run by the exchange throughout the month of March 2021. It stated that it would offer Dogecoins for a price that was one-fourth of what they were going for on other exchanges and would provide 150 Dogecoins to new users who signed up with the exchange. Five days after the conclusion of the campaign, dozens of investors began to protest that they had not gotten what they were promised and that the trading site of the exchange was no longer accessible to them. The exchange said via a tweet that it has temporarily paused all transactions in order to analyze an unnamed partnership offer. It also stated that the evaluation process would take between four and five working days, during which time there would be no transactions. Photos of Ozer departing Turkey were widely circulated in the media on April 20, which caused investors to experience even greater levels of anxiety.

Within a matter of days, the Turkish government took action to freeze Thodex’s accounts, and Istanbul police conducted a search warrant at the company’s headquarters. On April 30, six individuals were arrested and taken to jail pending trial. According to claims in the media citing attorneys for the victims, the stock exchange went bankrupt despite still holding at least $2 billion in funds contributed by 391,000 investors. The majority of the investors were under the age of 34, and many of them were either students or workers with low incomes.

During the subsequent trial, the attorney for the exchange, Sevgi Eraslan, stated in court that the crash of the exchange was caused by the volatility of cryptocurrencies as well as a hacking attack, and he referred to the allegations of fraud as being ludicrous.

Ozer denied that he had run off with the money and indicated that he would return, but he remained abroad during the trial of thirty of the exchange’s staff members, including his brother and sister, who were accused of fraud and organized crime.

The closure of the exchange occurred around the same time that the Turkish Central Bank announced new measures to regulate the cryptocurrency market. As a result of the sharp decline in the value of the Turkish lira and high inflation, many Turks have turned to the cryptocurrency market as an alternative investment. According to a survey on worldwide trends by Chainalysis that was reported by the Financial Times, Turkey has the biggest transaction volumes for cryptocurrencies than any other country in the Middle East, and these numbers are continually expanding. According to the data that was cited in the report, there is a direct correlation between the devaluation of the lira and the volume of bitcoin that is traded on exchanges.

Following the closure of Thodex and the subsequent crash of Vebitcoin, a competing local exchange, President Tayyip Erdogan issued a decree that included cryptocurrency exchanges on a list of entities that are subject to Turkey’s laws regarding the financing of terrorism and the laundering of illicit funds. The laws, which went into force at once, make it the responsibility of crypto asset service providers to monitor their clients’ usage of the assets to ensure they are not being put to unlawful use. A regulation that was issued in the middle of April, only a few days before Thodex was taken offline, prohibited the usage of cryptocurrencies as a form of payment.

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