Turkish government to track crypto transactions over $1,200

May 7, 2021 Coin Telegraph

Turkish government to track crypto transactions over ,200

Turkey’s Minister of Treasury and Finance sheds light on regulatory actions following an alleged $150-million crypto exchange scam.

Crypto exchanges with a presence in Turkey must now inform the Financial Crimes Investigation Board, or MASAK, about any crypto transactions over 10,000 Turkish liras ($1,200).

Turkish Minister of Treasury and Finance Lütfi Elvan announced the new policy on a CNN Turk live broadcast last night.

Two weeks after a $150-million fraud involving a major crypto exchange in Turkey, Elvan shared updates on the government’s draft crypto regulation on live TV. Turkey’s central bank has defined crypto as a nonmonetary asset and banned the use of cryptocurrency as a form of payment.

Elvan noted that the second step was to grant MASAK the authority to audit and oversee crypto exchanges.

According to Elvan, MASAK has prepared a guideline for crypto exchanges that includes the rules and penalties for reporting transactions.

“MASAK has full audit authority over crypto exchanges,” Elvan said. “Crypto trading platforms are now obliged to share the information of their active users with MASAK. They are liable for any suspicious activities on their platforms. They are also responsible for notifying MASAK about any transactions worth over 10,000 Turkish liras in 10 days after the trading.”

Elvan announced that a legal draft has been prepared in cooperation with the Banking Regulation and Supervision Agency, Capital Markets Board and Revenue Administration under the presidency of the deputy minister, as Cointelegraph reported last month.

According to Elvan, opinions from local experts and crypto exchange representatives were also taken during the study. The final draft will be soon ready for approval by President Recep Tayyip Erdoğan, he added.

In April, Cointelegraph reported that Turkish police detained 62 people following the Thodex crypto exchange fraud. According to the local experts, Turkey needs a clear regulation and fair taxing regarding crypto to avoid further victimization of local crypto users.

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The arrested siblings of the missing Thodex CEO reportedly own millions of dollars worth of crypto.

Turkish authorities are progressing with an investigation into local cryptocurrency exchange Thodex, which abruptly halted trading last week.

On Thursday, a Turkish court jailed six suspects pending trial, including siblings of the missing CEO and senior company employees, Reuters reported.

As part of a probe, Interpol reportedly issued a red notice for Thodex CEO and founder Faruk Fatih Özer, who had reportedly flown to Albania. “When he is caught with the red notice, we have extradition agreements with a large part of these countries. God willing he will be caught and he will be returned,” Interior Minister Suleyman Soylu said.

Local authorities detained over 83 individuals suspected to be involved in the case amid growing concerns that Thodex was a scam after the platform halted money withdrawals.

Some suspects indicated that Özer’s siblings — Güven Özer and Serap Özer — could have been serving major roles in Thodex's operations, noting that both had significant crypto holdings, local news agency Anadolu Agency reports.

Güven Özer reportedly holds nearly 22 million Turskish liras ($2.7 million) on two major local crypto exchanges including BtcTurk and Paribu. Güven reportedly served as an active executive at Thodex despite not having an official role at the company.

Serap Özer, the missing CEO’s sister, reportedly had over 120 million liras ($14.6 million) worth of crypto transactions on her Binance account between 2018 and 2021. She claimed that the account was not hers. Serap allegedly oversaw financial activities at Thodex.

As previously reported, the missing Thodex CEO is reported to have run off with as much as $2 billion worth of crypto, but according to the latest reports, Interior Minister Soylu said that the company’s portfolio totaled $108 million.

The news comes as the Turkish government hardens its stance on crypto, with the country’s central bank officially banning crypto payments effective today. Another Turskish crypto exchange, Vebitcoin, also announced last week that it would be ceasing operations amid employee arrests and allegations of fraud.

Additional reporting by Erhan Kahraman.

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Vebitcoin CEO Ilker Bas is reportedly in police custody, with Thodex owner Faruk Fatih Özer suspected to have fled to Albania.

Following the arrests of several employees at Turkey-based crypto exchanges Thodex and Vebitcoin last week, government officials are reportedly planning to establish a central bank authority which could custody digital assets.

According to a Bloomberg report, an unnamed senior official in the Turkish government said local authorities may be creating a central custodian bank aimed at eliminating counterparty risk for dealing in cryptocurrencies. The same source claimed that the government was also looking at instituting a capital threshold for exchanges and requiring executives at crypto firms to have a certain foundational knowledge of digital currencies.

The report comes as Thodex owner Faruk Fatih Özer is rumored to have fled to Albania following allegations of an exit scam which may have defrauded more than 390,000 users of the crypto exchange out of roughly $2 billion. Police detained 62 people connected to Thodex as the exchange said it would halt trading and withdrawals, while an international arrest order has been issued for Özer. Today, Albanian police raided a house in Tirana and detained two people who allegedly provided aid to Özer, but were unable to find the crypto exchange owner.

The state-run news agency Anadolu also announced employees from crypto exchange Vebitcoin were being held by authorities under similar allegations of fraud, later reporting that CEO Ilker Bas was among the four detained. Though Vebitcoin said on its website it would cease operations, Turkey’s Financial Crimes Investigation Board has reportedly already blocked Vebitcoin’s accounts and opened an investigation into the alleged fraud.

The arrests and restrictions from exchanges come after Turkey’s recently appointed central bank governor Şahap Kavcıoğlu effectively said he would ban cryptocurrencies in the country, a decree set to go into effect starting Friday. The order would reportedly prohibit holders from using their crypto for payments and will also prevent payment providers from providing fiat onramps for crypto exchanges.

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Bitcoin ban

The arrested employees, including directors, are suspected of fraud.

As a countrywide cryptocurrency ban looms, multiple Turkish exchanges have now come under investigation with four employees of the recently-shuttered Vebitcoin exchange arrested this morning for allegations of fraud.

Last night, Vebitcoin announced it would be ceasing operations in a short statement posted on its website, claiming that unspecified financial strain led to the decision — possibly caused by an unusually high number of withdrawals leading up to Turkey’s forthcoming cryptocurrency ban.

“We have decided to cease our activities in order to fulfill all regulations and claims,” the announcement read in part.

The exchange was among the largest in Turkey with nearly $60 million in daily volume, with Bitcoin accounting for half of the trading activity.

This morning, Muğla chief public prosecutor Mehmet Nadir Yağcı announced in a statement to local media that four employees have been detained by law enforcement following allegations of fraud.

"Following the search and seizure operations carried out at the company headquarters and at some addresses, 4 people, who are company directors and employees, were detained. The investigation carried out by the Directorate of Cyber Crimes Branch of the Muğla Police Department is carried out in a multifaceted and meticulous manner."

MASAK, Turkey’s financial crime enforcement wing, is currently investigating.

The arrests follow a similar pattern seen in the aftermath of fellow exchange Thodex’s closure. Thodex announced a halt to all trading amid reports of a police raid and that the founder of the exchange had fled to Albania. Police subsequently issued upwards of 75 arrest warrants and detained 62 in connection to a possible exit scam.

The arrests and closures come after a surprise “diktat” from Turkey’s newly-appointed central bank governor effectively banning cryptocurrencies in the country, which will go into effect April 30th. The ban has become a hot-button issue, as opposition leaders have voiced support for crypto.

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Coin Telegraph

After major Turkish crypto exchange Thodex abruptly halted trading amid fears of a possible exit scam, police have already detained 62 people across eight provinces and issued detention warrants for 16 more.

Turkish police have detained 62 people as they continue to investigate an alleged exit scam potentially affecting 391,000 crypto exchange users and roughly $2 billion in investments.

Yesterday, Cointelegraph reported that the major Turkish crypto exchange Thodex had abruptly halted trading and withdrawals amid reports of police raids. Today, in addition to the 62 already detained across eight Turkish provinces, police have issued detention warrants for a further 16 people, according to the Associated Press.

Istanbul's chief prosecutor’s office yesterday announced it was opening a probe into the case following complaints from Thodex users who had lost access to their assets. Rumors have since been rife that Thodex owner Faruk Fatih Ozer has fled the country with the intent of defrauding users of their estimated $2 billion total in crypto. Whilst confirming that he had indeed left Turkey for Albania, according to AP, Ozer has denied all allegations and maintains he left for legitimate business-related reasons, ostensibly to meet foreign investors.

Ozer has also attempted to counter fears of an exit scam by claiming that Thodex is the target of a "smear campaign," contending that trading has been shut down due to an alleged cyberattack. The exchange had previously announced a six-hour-long maintenance break on April 20.

The Thodex story is unfolding during a pessimistic period for cryptocurrency users in Turkey, where a new ban, effective April 30, will prohibit holders from using their crypto for payments and will also prevent payments providers from providing fiat onramps for crypto exchanges.

Turkey

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