Prosecutor demands jail for Crypto.com user who received $6.8M by mistake

Australian prosecutors are reportedly advocating a prison sentence for a Crypto.com user who accidentally received nearly $7 million USD and spent most of it before the exchange discovered the internal error made three years ago.

In May 2021, Crypto.com sent $6.86 million (10.47 million AUD) to Australian couple Thevamanogari Manivel and Jatinder Singh instead of a $100 refund, after an employee allegedly typed an account number into the payment section of an Excel spreadsheet.

However, the exchange detected that the bank account did not match the exchange account. Therefore, a refund was issued, but instead of refunding the 100 AUD that the couple tried to put in, the exchange mistakenly sent 10.5 million AU$ to Manivel’s bank account.

By the time the exchange found the error in its December 2021 internal audit, just seven months later, Singh had already bought multiple homes and gifted a friend $1 million AU. He claimed he thought he had won “an online raffle.”

Australian prosecutor argues jail sentence is necessary

In the latest court hearing on Aug. 2, roughly three years after the incident, Australian prosecutor Campbell Thomson argued that the amount of money involved, it was “out of range” to be considered a crime of opportunity. He stated that a jail sentence was necessary for Singh, according to an Aug. 2 report.

“It may not be that you send him to jail for very long at all after taking into account his presentence detention,” he said.

Meanwhile, Singh’s lawyer, Martin Kozlowski, argued that Singh didn’t fully grasp the seriousness of the unusual situation, which would have been a challenge for anyone.

“It must be taken into account the funds here came from a multinational that didn’t even know the funds were gone until an audit sometime later,” Kozlowski said.

“Nobody knows how they would respond if faced by the same situation,” he added.

Previously raised concerns about Singh being a flight risk

In March 2023, prosecutors argued that Singh was financially driven to flee the country since only $4.9 million had been recovered, with part of it already sent abroad.

Singh is scheduled to be sentenced next month. In September 2023, his partner, Manivel, was given a roughly seven-month prison sentence (time already served) and placed on an 18-month community corrections order after pleading guilty to recklessly handling the proceeds of crime.

Related: Darknet market crypto crimes on the rise in 2023, $1.7B revenue — Chainalysis

This follows a reported increase in crypto crime in Australia recently.

On July 15, the Australian Transaction Reports and Analysis Centre (AUSTRAC) Money Laundering National Risk Assessment reported increased criminal use of crypto and related services in its latest report on money laundering.

AUSTRAC anticipated a spike in the criminal use of cryptocu due to greater anonymity and faster speed of transactions.

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