As the Canadian cryptocurrency exchange QuadrigaCX case about its $190 million crypto loss is escalating, rumors claim that the exchange is operated by a criminal who has been involved in identity theft.
About a year ago, it was reported on Reddit that back in 2005, Quadriga CX is operated by Omar Dhanani who has pleaded guilty with five others for committing credit card and identity document fraud as part of the “ShadowCrew” criminal organization. According to the details, Dhanani uses the fake identity of Michael Patryn who is the co-founder of Quadriga.
It was found on an Intelius list that Omar Dhanani was a resident of Fountain Valley, California – as stated in the DOJ document against the fraudster Omar Dhanani – with relatives Nazmin Dhanani and Nabatbibi Dhanani.
While this does not prove anything, as there could be plenty of people with the name Omar Dhanani living in the same city or town, the user also discovered that there is a Vancouver company called MPD Advertising that has been co-founded by Michael Patryn and Nazmin Dhanani. It was also stated that Patryn and Dhanani founded several other companies together, but there was no proof for that.
Please note that these claims can only be considered as rumors until solid proof is provided by any parties involved. For example, there is no solid proof that the fraudster Omar Dhanani and Quadriga co-founder Michael Patryn are the same persons.
In another Reddit thread, a user nicknamed “crypto77777” has also claimed that the nature of the Canadian cryptocurrency exchange is dubious. According to the Reddit user, the domain registration of the exchange is private, located in the Bahamas. Furthermore, the domain allegedly lacks SSL protection on its supporting portals, and its official address is a rental UPS mailbox in Vancouver.
Also, the user stated that he does not think that Quadriga has a valid company registration in Canada. For wire – which has been confirmed in a comment under the thread by the operators, the exchange uses a Polish bank where Canadian users are unable to reverse transactions in case of fraud. Finally, there is no information on the Quadriga website about the management team of the company.
The allegations are rumors come in the light of events where the operators of the Canadian cryptocurrency exchange are unable to access the cryptocurrency they held in cold wallets after the sudden death of Quadriga CEO Gerald Cotten who had sole access to the funds as well as the wallet’s private keys.
While it’s not clear how were the exchange’s funds divided between hot and cold storage, according to the latest court filings, Quadriga CX allegedly owes about 250 million CAD (the equivalent of $190 million) to its customers.
Although the operators of Quadriga stated they don’t have access to the cold wallets after Cotten’s death, a blockchain analysis showed that funds transferred out of the exchange’s Litecoin wallets.
To initiate such transaction, one should have access to the wallet’s private keys. Therefore, it becomes a question of whether Quadriga users are facing fraud in this mysterious case.