US Prosecutors Charge Two Canadians Over HitBTC Clone Scam

US authorities have accused two Canadian citizens of defrauding an Oregon resident of more than 23.2 bitcoins, worth approximately $230,000 at press time, through cloning the Twitter handle of Hong Kong-based crypto exchange HitBTC.

According to the indictment, Karanjit Khatkar and Jagroop Khatkar, of Canada’s British Columbia, are each accused of six counts of wire fraud, as well as conspiracy to commit wire fraud and Money Laundering Money Laundering Money laundering is a blanket term to describe the process by which criminals disguise the original ownership and proceeds of criminal conduct by making such proceeds appear to be derived from a legitimate source.Money laundering is an issue that traverses countless industries and sectors, which includes the financial services space. Though criminal money may be successfully laundered without the assistance of the financial sector, billions of dollars’ worth of criminally derived money are laund Money laundering is a blanket term to describe the process by which criminals disguise the original ownership and proceeds of criminal conduct by making such proceeds appear to be derived from a legitimate source.Money laundering is an issue that traverses countless industries and sectors, which includes the financial services space. Though criminal money may be successfully laundered without the assistance of the financial sector, billions of dollars’ worth of criminally derived money are laund Read this Term. They face up to 20 years in federal prison if convicted.

From October 2017 to August 2018, Karanjit and Jagroop Khatkar are said to have impersonated HitBTC’s Twitter account, using the name @HitBTCAssist, to mislead the crypto Exchange Exchange An exchange is known as a marketplace that supports the trading of derivatives, commodities, securities, and other financial instruments.Generally, an exchange is accessible through a digital platform or sometimes at a tangible address where investors organize to perform trading. Among the chief responsibilities of an exchange would be to uphold honest and fair-trading practices. These are instrumental in making sure that the distribution of supported security rates on that exchange are effectiv An exchange is known as a marketplace that supports the trading of derivatives, commodities, securities, and other financial instruments.Generally, an exchange is accessible through a digital platform or sometimes at a tangible address where investors organize to perform trading. Among the chief responsibilities of an exchange would be to uphold honest and fair-trading practices. These are instrumental in making sure that the distribution of supported security rates on that exchange are effectiv Read this Term’s customers and making it appear they were communicating with a customer service representative.

An unsuspecting victim from Oregon, who thought she was talking to HitBTC’s staff, was then told to hand over her account’s login credentials at both HitBTC and Kraken, another US-based crypto exchange. The defrauded client lost thousands of dollars as the defendants took over her email and transferred in excess of $200,000 in crypto assets from HitBTC to their Kraken accounts.

FBI arrested Karanjit Khatkar

“The defendants initiated transfers of 23.2 bitcoins from the victim’s HitBTC account to Karanjit Khatkar’s Kraken account. Karanjit Khatkar in turn transferred approximately 11.6 in stolen bitcoins to Jagroop Khatkar’s Kraken account. The stolen bitcoins have an estimated present value of approximately $233,220,” according to the indictment.

FBI arrested Karanjit Khatkar last month upon arrival at the McCarran airport in Las Vegas and was detained pending transport to the District of Oregon. He made his first appearance on August 12, while his four-day trial is scheduled to begin on October 8. His partner Jagroop Khatkar, however, remains at large and is believed to be in Canada.