Investors filed the first civil lawsuit against JPEX, and more lawsuits are expected
Two people have filed a civil suit against cryptocurrency trading company JPEX and other defendants. JPEX was accused of defrauding it of 1.6 billion Hong Kong dollars ($208 million). This is the first civil lawsuit in the matter and more are expected to follow.
Herbert Lam Sung-him and Chan Wing-yan are seeking $236,500 each in the Hong Kong District Court, the South China Morning Post reported. On June 4, the couple filed three alternative claims, meaning the court could choose between them.
In addition to JPX, the suit also names a defendant company – Web3.0 Technical Support, three individuals who “participated in or assisted in the scheme” as “wallet holders”.[s]” and Felix Chiu King-Yin, CEO of JPEX-linked cryptocurrency exchange CoinGaro.
A civil lawsuit is only an option against JPEX.
The allegation revolves around three transfers of JPX wallet Chan in July and August involving $110,500 in Tether (USDT) and $130,000 in cash at current exchange rates. One of the transfers was in the name of a cow. The plaintiffs have since been unable to withdraw those funds. They discovered that the money was out of their wallets “within five minutes” of deposits.
Related: Hong Kong to tighten crypto regulation following JPEX fraud case
A civil suit is the only way for victims of alleged defrauding to recover money, said Chan and Lam's lawyer, Joshua Chu Kiu-wah. He added:
“Findings from the civil process may strengthen parallel criminal investigations of suspects, highlighting the importance of a multi-pronged legal strategy for victims.”
JPEX had many affiliates.
The investigation into Dubai-based JPEX began in September after Hong Kong's Securities and Futures Commission found it to be an unlicensed virtual currency trading platform. Eleven people were arrested that month. The Hong Kong Free Press reported that by June 3, the total number of people arrested had risen to 73, and all had been released on bail.
Social media influencer Joseph Lam Chok, also known as Lin Zuo, was among those arrested. The plaintiffs mentioned him by name in the suit.
Police had received 2,265 complaints against JPEX till April. Lawmaker Johnny Ng Kit-chong said he had met hundreds of victims and was aware of 10 more civil cases.
Magazine: Mt Gox won't drop Bitcoin yet, Hong Kong crypto exchanges: Asia Express
