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Former employee of Cryptopia confessed to stealing about $172,000 worth of digital assets

A former employee has reportedly pleaded guilty to embezzling 245,000 New Zealand Dollars (around $ 172,000) worth of cryptocurrencies and stealing customer data from the now-defunct New Zealand-based crypto exchange Cryptopia.

A former employee admitted to embezzling cryptocurrencies from the now-defunct Cryptopia

According to a Monday report from New Zealand news outlet Stuff, an ex-Cryptopia staffer admitted he stole nearly NZD 250,000 (around $170,000). He pleaded guilty on two charges – theft by a person in a special relationship and theft of more than NZD 1,000.

According to the hearing at the Christchurch District Court on Monday before Judge Gerard Lynch, the man-made an unauthorized copy of private keys from Cryptopia’s numerous wallets and saved it on a USB storage device.

Then he took it home and uploaded the data to his personal computer. It is worth noting that having the private key to the wallet of the exchange is likely to give him access to thousands of digital wallets along with $100 million in multiple cryptocurrencies.

The first signs of crime occurred on September 3, 2020, when a former customer of the exchange said he had mistakenly deposited bitcoins into his old Cryptopia wallet and demanded his money back. Accounting firm Grant Thornton reviewed the location of the transaction and determined that 13 BTC had been illegally recovered following a series of operations. At the time, this amount of cryptocurrency was equivalent to $165,000.

former-employee-of-cryptopia-confessed-to-stealing-about-172000-worth-of-digital-assets

On September 10, former Cryptopia employees contacted David Ruscoe and Tom Aspin of Grant Thornton and confessed that he had stolen the equivalent of BTC. Furthermore, he admitted to using another $7,000 worth of cryptocurrency. The former employee returned some of the stolen cryptocurrency and offered to pay the rest. However, he was convicted and will be released on bail until sentencing on October 20.

In January 2019, Cryptopia admitted that it was the victim of a hack. Its team was able to defend the site to some extent. Although the exchange refused to disclose the actual amount stolen, the attackers still caused massive damage. A significant amount of 19,391 ETH (about $2.5 million at that time) was recently transferred from Cryptopia to an unknown wallet, which could indicate the size of the missing funds or at least is part of them.

Later that year, Cryptopia was liquidated after $24 million worth of cryptocurrency was stolen following another hack. This figure represents 15% of the exchange’s cryptocurrency and is considered the largest theft in New Zealand history.

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