Benzinga - Thailand's Securities and Exchange Commission (SEC) has initiated legal proceedings against Ekkalarp Yimwilai, the former director and CEO of cryptocurrency exchange Zipmex Thailand, for allegedly making false statements and concealing information crucial to the public.
What Happened: The charges, filed with the Economic Crime Suppression Division (ECC), accuse Yimwilai of corruption, deception and misappropriation of property through misleading representations and omissions in the company's financial accounts and documents.
The investigation that led to these charges centered around the provision of ZipUp/ZipUp+ services by Zipmex Thailand.
These services offered bonuses to customers using the digital wallet (Z Wallet) on the exchange.
The SEC's scrutiny began following the company's notification to customers about changes in the terms and conditions of the ZipUp+ service, which shifted from being provided by Zipmex Thailand to Zipmex Asia Pte. Ltd., Singapore, and/or other affiliated companies starting May 8, 2022.
This notification coincided with the suspension of the Z Wallet's deposit and withdrawal functions.
The SEC discovered discrepancies between Zipmex Thailand's public statements and the actual movement of customer digital assets, which were transferred to overseas wallets before the announced changes.
Also Read: How Bitcoin ETFs Reshape The Investment Landscape: 'Mega-Bullish Longer Term,' Expert Tells Benzinga
This action contradicted the company's assurances and led the SEC to conclude that Zipmex Thailand engaged in fraudulent activities by presenting false statements and withholding essential information from its customers. As a result, customers were misled into believing their assets remained within Z Wallet for local profit generation.
The SEC also identified inconsistencies in the reports submitted by Zipmex Thailand regarding customer assets, which did not match the facts verified by the SEC.
Why It Matters: The legal complaint against Yimwilai marks the start of a criminal investigation process, which will determine the extent of legal violations through the investigative, prosecutorial and judicial phases.
This legal action follows the SEC's recent directive to Zipmex Thailand to halt its digital asset trading and brokerage services. The directive is part of broader regulatory scrutiny following the approval granted to Zipmex Thailand by the Ministry of Finance and the SEC in 2020 to operate within the country.
Zipmex, headquartered in Singapore and led by Marcus Lim, has since announced the suspension of its website and mobile application services.
Read Next: Donald Trump Calls CBDCs 'Dangerous' And Deems AI 'A Tremendous Security Problem'
Photo: Shutterstock
© 2024 Benzinga.com. Benzinga does not provide investment advice. All rights reserved.