Now a judge in south-east Australia has ordered the sale of the property – which the woman appears to have bought as a gift for her expatriate sister – and awarded all proceeds from the sale to the crypto firm.
The cautionary tale has garnered international attention, as it turned out it took Crypto.com seven months to realize the flaw.
Katie Gregory, a spokeswoman for Crypto.com, wrote that the company could not comment “as the matter is in court.”
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Crypto.com is best known outside of the cryptocurrency world as the company whose name now adorns the former Staples Center in Los Angeles – and for Super Bowl commercials starring actor Matt Damon and basketball star LeBron James portraying cryptocurrency investors as pioneers the slogan “Fortune favors the brave.”
It laid off 5 percent of its corporate workforce in June amid a widespread downturn in the cryptocurrency market.
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The Victorian Supreme Court heard that Crypto.com, which operates under a different company name in Australia, mistakenly remitted about $7.2 million to Thevamanogari Manivel in May 2021, rather than the approximately $68 refund it was due. The error occurred when an employee accidentally filled in the payment amount field with an account number, the court said.
“Extraordinarily, the plaintiffs allegedly did not notice this significant error until around 7 months later, at the end of December 2021,” the court said in its ruling during an examination. In February, after investigating what happened, the company attempted to freeze Manivel’s accounts in order to recover the full amount, according to the background to the case released by the court.
However, Crypto.com presented evidence showing that Manivel had already transferred most of the money to an account held jointly with another defendant who may have been in a “romantic relationship” with Manivel, according to the dated Court heard evidence. Manivel also sent her daughter nearly $300,000, and in February she bought a $925,000 plot of land in Craigieburn for her sister, Thilagavathy Gangadory, who lives in Malaysia.
Located about 20 miles north of Melbourne on a more than 5,800-square-foot lot, the four-bedroom, four-bathroom mansion has a private cinema, gym and parking for two cars, according to Australian website realestate.com.au.
Attorneys for Manivel and Gangadory were not listed in the sentencing document.
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Crypto.com’s Australian companies have since been embroiled in lawsuits against Manivel, Gangadory and six other defendants. In May, Judge James Dudley Elliott entered a default judgment in the case against Gangadory – meaning she did not press charges within the court’s time limit. Elliott therefore ruled in favor of the plaintiff Foris GFS Australia Pty Ltd., which helps operate Crypto.com’s trading platform in Australia.
The company’s lawyers appear to have been unable to reach Gangadory, the court said, although she appears aware the case is ongoing, as her sister’s lawyers said in March that Gangadory was seeking legal counsel.
Pursuant to the judge’s decision published last week, Foris GFS has been awarded all proceeds and interest from the sale of the Craigieburn property. Gangadory was ordered to pay the company’s attorneys’ fees related to the case and 10 percent interest, equivalent to nearly $19,000, the court said.
Gangadory can appeal, but she must present “a valid reason for the failure to file documents, a valid defense of the case and reasons why the court should not have issued the order against her,” according to the Victoria County Court. The next court date is October 7, when the judge will lay out the next steps of the case in what is known as an “instruction hearing.”