Rhino Trading, owner of the OTCPro exchange, mistakenly credited a user with $653,000 (A$995,000) in January, instead of the expected $65,300 (A$99,500), according to court documents cited by ABC News. After realizing its error on February 4, Rhino Trading attempted to recover the funds, but the user, Kow Seng Chai, did not respond to emails.
Court documents also indicate that the user used some of the funds sent in error to buy Tether (USDT) and withdraw from the exchange in batches of $100,000, the maximum daily limit, withdrawing around $626,700 (AUD956,000) over ten days. Rhino Trading also claims that when called on the number linked to its account, the person who answered said it was not Chai's number.
Attempt to recover funds
Rhino Trading applied to the Supreme Court of Victoria to recover the funds sent in error. The court froze Chai's assets on February 9 and issued an injunction on February 21 to prevent him from leaving the country. Justice Michael Osborne noted the real risk of asset disposal, given the falsified bank statements, when he issued the orders freezing Chai's assets and restricting his departure from Australia.
Risks for Crypto Exchanges
This Rhino Trading credit error highlights the potential risks for crypto exchanges, particularly with regard to human and system errors. Exchanges must be vigilant to avoid such errors and implement security measures to protect user funds.
In conclusion, Rhino Trading's credit error highlights the potential risks for crypto exchanges and the need for them to be vigilant to avoid such mistakes. Rhino Trading filed an application with the Supreme Court of Victoria to recover the funds sent in error, but the user did not respond to the emails and withdrew part of the funds.
