Understanding Crypto.com’s $7.2 Million Typo
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After 15 months, Crypto.com is trying to get the money back.
Important points
- Crypto.com accidentally paid a customer over $7 million and didn’t notice the mistake for seven months.
- The judge ordered the customer to repay the money as well as interest and court costs.
- If a crypto exchange makes a mistake in your favor, report the problem – the money is not yours to keep.
Popular cryptocurrency exchange Crypto.com is taking legal action against a customer in Australia who kept $7.2 million that was accidentally deposited into her account. It appears that a Crypto.com employee inadvertently entered an account number instead of an amount in the transfer field. As a result, Thevamanogari Manivel received around $7.2 million instead of the intended $68. Manivel kept the money and Crypto.com is trying to recover the money plus interest and court costs.
Anyone seen my millions?
The challenge for Crypto.com is that it took seven months for anyone to notice the bug. The accidental payment was made in May 2021 and was only discovered in an internal audit at the end of that year. “Extraordinarily, the plaintiffs allegedly did not realize this significant error until some seven months later, in late December 2021,” commented the High Court judge in the case.
Crypto.com then started legal proceedings and Manivel’s account was frozen. But by then she had already spent some of the cash and transferred more to family members and other accounts. In addition, the court heard Manivel had spent almost $1 million on a mansion for her sister.
Last week, the judge ordered that the property be sold and the money returned to Crypto.com. In accordance The Washington Post, she must also pay court costs, plus accrue $20,000 in interest. So far, Crypto.com has not been able to get a response from Manivel, and the verdict was taken without the presence of her lawyers. The next court date is set for October.
Crypto.com has not responded to media inquiries as it is an ongoing matter. After an extraordinary 2021 where the crypto exchange bought the naming rights to the Staples Center and signed several other high-profile sponsorship deals, 2022 has been a different story. The company has reduced stake rewards on the Cronos (CRO) token and laid off a number of employees.
What happens if a crypto exchange accidentally sends you money?
It’s not the first time a crypto platform has accidentally sent money to customers. Both BlockFi and Compound were in the news last year for similar incidents. BlockFi mistakenly transferred Bitcoin (BTC) to some of the users in a campaign. DeFi platform Compound sent over $90 million when a system upgrade went wrong.
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If a bank makes a mistake in your favor, it can reverse the transaction and take the money back. Life is not like monopoly. If you try to use that money or, for example, move it to a high-interest savings account in the hope of profiting from it, you could face criminal charges. Contact your bank immediately and report the problem.
You might think that the crypto world is different. After all, it’s outside the traditional system and anything goes in cryptoland, right? Error. It’s still not your money and you can’t just keep it. The ruling in Australia shows that trying to profit from this type of mistake can land you in hot water, both financially and legally.
