Dmitri Vasilev, the previous CEO the now defunct crypto trade WEX, was arrested Friday in Italy, the BBC’s Russian Provider documented.
The publication cites Vasilev’s acquaintance and two anonymous buyers in WEX who instructed BBC about the arrest. The attaché of the Russian embassy in Italy, Dmitri Gurin, declined to provide any details, as did the Italian financial police (Guardia de Finanza).
WEX was launched in 2017 as a successor of also defunct trade BTC-e, whose alleged operator, Alexander Vinnik was arrested in 2017 in Greece and now going through extradition to the U.S., France or Russia.
The year of frozen resources
WEX was launched by Russian citizen Vasilev and operated for a year, until it froze withdrawals in July 2018 and hasn’t restored usual service at any time given that. The problems started quickly after Vasilev attempted to sell WEX to Dmitri Khavchenko, a militia fighter in the war in Jap Ukraine.
Khavchenko instructed CoinDesk last year that WEX’s admin (who, like the rest of the help workforce, was anonymous) didn’t like him as the new owner and disappeared with the keys.
He also mentioned at the time that the buy deal was full. Khavchenko afterwards transformed the formal owner of the Singapore-registered trade to his daughter, Daria, he also instructed CoinDesk.
In the meantime, about the summertime and slide of 2018, just about $19 million well worth of ether moved from the exchange’s cold wallets to the well-known crypto trade Binance.
Responding to the outcry on Twitter, Binance CEO CZ mentioned that WEX’s accounts on Binance experienced been frozen. The destiny of individuals resources is unclear given that then.
Police move in
Customers, mainly from Russia and neighboring countries, who have been unable to get back again their crypto and fiat deposited with WEX, started filing police studies in the slide of 2018. According to BBC, the Kazakhstan national police started a prison investigation of Vasilev centered on one these kinds of report, as nicely as the police of the Russian city of Tolyatti, which started a individual preliminary investigation.
The end users even wrote an open letter to Russia’s president Vladimir Putin, asking for justice and their revenue back again, the Russian crypto media website Forklog documented in April. The end users have been notified that the letter was then handed to Russian police headquarters.
In March of this year, the auditing agency PwC documented that two Iranian citizens, Faramarz Shahi Savandi and Mohammad Mehdi Shah Mansouri, who are mentioned to have developed the SamSam ransomware, experienced been using WEX to launder about $6 million collected in ransom payments.
BTC-e was previously linked to the theft of bitcoin from the storied crypto trade Mt.Gox. According to a Wall Street Journal report, “BTC-E appeared in 60 to 70 p.c of all prison cryptocurrency circumstances as a result of 2016.” The two BTC-e and WEX have been sluggish to introduce know-your-purchaser procedures and experienced anonymous help teams.
Picture of Dmitrii Vasilev, ex-CEO of the crypto trade WEX, by way of YouTube