CEO Rug Pulls Exchange for $2.5B; Faces 40k Years Jail Time

CEO of centralized exchange Thodex faces 40,000 years in jail after reportedly stealing $125M, following $2.5B of missing customer funds.

CEO Rug Pulls Exchange for $2.5B; Looking at 40,000 Years of Jail Time
Photo by Grant Durr / Unsplash

This is one of the few cases of a rug pull being penalized. In April 2021, the Turkish centralized crypto exchange Thodex, halted all user transactions. By this point, we’re used to hearing that, but this was before the Terra LUNA meltdown crippled the crypto market’s credit availability and liquidity. The company claimed this was due to a cyberattack and that all of the user’s funds were safe. Then the CEO disappeared.

Faruk Fatih Özer, CEO of Thodex

The CEO of the exchange, Faruk Fatih Özer, fled after transactions were halted. Turkish police swooped in and arrested dozens of Thodex employees. Many of them have been jailed, while others have ongoing cases with the country.

Özer reportedly moved $125M in Bitcoin out of Thodex and into Kraken prior to going missing, which can only be classified as theft from the company coffers, though the reporting for the actual amount stolen varies wildly. According to the Turkish government Özer only had $20M, while Chainalysis attributes a whopping $2.5B to the theft. According to them, that accounts for 90% of the value stolen via rug pulls in 2021.

This resulted in Interpol putting out a red notice for him, basically asking the international community to arrest him if they see him. Comically, it appears his disguise was shaving his head. Özer was arrested in Albania and extradited to Turkey.

40,526 Years of Jail Time

There are currently over 2,000 victims included in the indictment, which has ballooned the consequences Özer is facing up to 40,526 years of jail time. With good behavior, he may get out this millennium.