An ex-compliance officer of the renowned Singapore-based cryptocurrency exchange platform, Crypto.com, was recently charged with extortion and money laundering charges in Malta. This was after using his former position to obtain confidential information about the company illegally and using it to threaten the company to pay him more after being removed from his post.
The Maltese court has taken the suspect in custody after his threats to the company, now facing as many as nine charges for his alleged crimes.
Crypto.com's Ex-Compliance Officer Faces Nine Charges in Malta
Jose Luis Alonso Melchor, a former compliance officer for Crypto.com, is now facing nine charges filed to a Maltese court for his actions against the company since he was removed from his position. According to Malta Today, Melchor is facing charges including two counts of extortion, money laundering, unauthorized access to Crypto.com's computers, and taking, tampering with, and disclosing sensitive data.
(Photo : Crypto.com)
In the report, Melchor was arraigned last Thursday after being caught by authorities. Crypto.com terminated Melchor after breaking an attachment order that the company did not disclose.
Angry about his termination, Melchor illegally accessed Crypto.com's files and used them to threaten the company if he was not compensated for €44,00 ($47,644).
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Ex-Compliance Officer Denied of Bail, Considered a Flight Risk
After his arraignment, magistrate Nadia Vella denied Melchor's bail requests as he was considered a flight risk, and he also faced a €2 million ($2.2 million) freezing order. Crypto.com claimed it would continue working with authorities amidst the upcoming legal battle against its former compliance officer in a statement to Protos.
Crypto.com and Its Issues, Scrutinies
Among the most popular crypto exchange companies was Crypto.com. It was previously known for using Matt Damon as one of its endorsers in advertisements, but it also faced massive scrutiny in the past. In 2022, the company suffered from a massive hack that paved the way for hundreds of accounts to be breached by threat actors, but no funds were stolen.
The platform is also known for a massive fiasco two years ago when it mistakenly sent $7.2 million to a specific account instead of only $68 due to a type that the company admitted to. Later, it pursued the user who did not comply with its request to refund the money with a lawsuit, and the judge ruled in their favor, plus 10 percent interest and legal fees.
Over the past year, we have seen top crypto exchange companies drop like flies because of scrutinies like FTX and Binance, with Crypto.com also facing these problems with regulators. However, its latest case is not about its compliance but about a former compliance officer who illegally obtained information to use against the company, now pursued by the law.
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