Thodex Crypto Scam

🔴 High Risk

The Thodex crypto scam stands as one of the most significant financial crimes in Turkey’s recent history, exposing the vulnerabilities within the country’s burgeoning cryptocurrency market. Centered on a Turkish exchange that abruptly collapsed in 2021, the scandal involved the misappropriation and laundering of billions of dollars from hundreds of thousands of investors. This case not only highlights the risks of inadequate regulatory oversight but also underscores the complex methods of money laundering employed in the digital age. The swift and comprehensive response by Turkish authorities further illustrates the country’s commitment to tackling financial crimes and tightening controls around virtual assets.

The Thodex crypto scam is Turkey’s largest cryptocurrency fraud, involving the theft of around $2 billion from approximately 390,000 investors. In April 2021, the Turkish exchange abruptly suspended operations, and its CEO, Faruk Fatih Özer, fled the country. Turkish authorities quickly froze assets, raided offices, and launched investigations. Özer and co-conspirators used complex laundering techniques by moving funds through multiple wallets and international exchanges. After international cooperation, Özer was extradited, and severe prison sentences were handed down. The case prompted significant regulatory reforms in Turkey’s cryptocurrency oversight and highlighted the need for better anti-money laundering enforcement.

Countries Involved

The primary country involved in the Thodex crypto scam is Turkey. The case is intrinsically tied to Turkey as Thodex was a Turkish-based cryptocurrency exchange operating out of Istanbul. The scam affected Turkish citizens and was investigated and prosecuted by Turkish authorities. Albania became incidentally involved when the exchange’s CEO, Faruk Fatih Özer, fled there, prompting extradition efforts. However, the core of the illicit activities, victims, regulatory actions, and enforcement all centered on Turkey, underscoring that the case is ultimately a domestic issue with international overtones due to the escape and extradition

The scam came to light in April 2021. On April 18, 2021, Thodex suddenly went offline, effectively freezing out users. Complaints mounted rapidly, and by April 20, 2021, news surfaced that Faruk Fatih Özer had fled Turkey. Turkish authorities launched a formal investigation almost immediately, and arrests and prosecutions began within days. The collapse dominated Turkish financial headlines, and regulatory scrutiny increased as the full extent of the fraud became apparent

Bitcoin (BTC), various altcoins, stablecoins

The Thodex case is principally an example of aggravated fraud and large-scale financial crime, but it also prominently features anti-money laundering violations. The crimes charged include establishing and directing a criminal organization, aggravated fraud via electronic systems, laundering property values derived from crime, and unauthorized control and transfer of financial assets. All of these highlight the complex, multi-layered nature of the financial crimes committed, with money laundering integral to the disposition and attempted concealment of stolen funds

Thodex (legal entity: Koineks Teknoloji A.S.) operated the exchange.
Faruk Fatih Özer, the founder and CEO, directed operations and orchestrated the fraud.
Several family members (notably his brother Guven Özer and sister Serap Özer) and other company executives/staff were co-conspirators.
Turkish enforcement bodies, including the Istanbul Security General Directorate’s anti-cybercrime unit and Turkey’s Financial Crimes Investigation Board (MASAK), led the investigation.
The Albanian government played an ancillary role due to Özer’s flight and subsequent extradition.

PEP (Politically Exposed Person) involvement appears peripheral but is noteworthy. Faruk Fatih Özer was pictured with Turkish ministers and was socially active among political figures, indicating indirect links. However, there is no direct evidence that a current or former senior official was a co-conspirator or benefited. This suggests no explicit PEP involvement, but the case underlines the importance of social proximity to power for reputational laundering

The laundering methods used in the Thodex scam leveraged the opacity of crypto transactions and deficient regulatory oversight at the time. After freezing users’ assets, Özer and his associates reportedly transferred significant portions of the stolen funds through multiple blockchain wallets, aiming to obfuscate their origin. Fiat conversions were carried out using international exchanges and possibly peer-to-peer networks, exploiting the lack of robust KYC/AML controls. There was also an attempt to move proceeds internationally by fleeing the country and using foreign banking and crypto infrastructure. The rapid movement of funds, layering through diverse exchanges, and re-entry of illicit proceeds through other financial channels typified the laundering scheme. Turkish enforcement agencies, especially MASAK, tracked and froze suspect assets during their investigations

The scam’s estimated value is staggering—Turkish authorities determine that roughly $2 billion in crypto assets belonging to about 390,000 Turkish investors were misappropriated. Of this amount, precise tracking of how much was laundered through opaque chains or withdrawn as fiat currency remains complex, but authorities pursued asset recovery operations to trace the money flows

An analysis of on-chain and off-chain transactions revealed that, just before the platform went offline, substantial amounts of various cryptocurrencies were consolidated from user wallets to Thodex-controlled addresses. Funds were then moved in quick succession to international exchanges and “mixer” services that blend and anonymize coins, making tracking more difficult. Blockchain forensics suggested large-scale use of “peeling chains” (splitting and sending small amounts to new addresses) and conversion into stablecoins or other privacy-centric coins, frustrating direct tracing. After fleeing, Özer’s attempts to liquidate or further anonymize assets became a focal point for international law enforcement cooperation, culminating in asset freezes and partial recoveries

MASAK (Turkey’s Financial Crimes Investigation Board) promptly froze Thodex-linked accounts and assets.
The Istanbul Prosecutor’s Office and cybercrime units raided the company’s physical offices, seizing digital evidence for forensic analysis.
After Interpol coordination, an international arrest warrant was issued for Faruk Fatih Özer, leading to his capture and extradition from Albania.
Turkish courts prosecuted Özer and co-conspirators, resulting in 11,196-year sentences—a typical move in Turkey for major fraud, especially post-abolition of the death penalty. Heavy fines were imposed, and restitution to victims is ongoing.
The case also triggered a review of Turkey’s crypto regulations and consideration of central custodian banks for crypto assets, new compliance rules, and reinforced anti-money laundering laws for virtual asset service providers.

Thodex trial and background:
Wired’s detailed feature on the CEO and regulatory implications:
Background legislation and regulatory reactions
Transaction and seizure analysis

Thodex Crypto Scam
Case Title / Operation Name:
Thodex Crypto Scam
Country(s) Involved:
Albania, Turkey
Platform / Exchange Used:
Thodex (Koineks Teknoloji A.S.)
Cryptocurrency Involved:

Bitcoin (BTC), various altcoins, stablecoins

Volume Laundered (USD est.):
Approximately $2 billion
Wallet Addresses / TxIDs :
Multiple blockchain wallet addresses; specific TxIDs not publicly disclosed
Method of Laundering:

Layering through multiple wallets, use of mixers/tumblers, exchange hopping internationally, rapid transfers before shutdown, conversions to stablecoins

Source of Funds:

Fraud from user deposits on Thodex; aggravated fraud and theft of customer assets

Associated Shell Companies:

Not publicly disclosed or identified

PEPs or Individuals Involved:

Faruk Fatih Özer (CEO), Guven Özer (brother), Serap Özer (sister), other executives; indirect PEP connections socially but no confirmed official involvement

Law Enforcement / Regulatory Action:
MASAK asset freezes; Istanbul cybercrime raids; international arrest warrant and CEO extradition; sentences over 11,000 years; regulatory reforms in Turkey
Year of Occurrence:
2021
Ongoing Case:
Closed
AML Network Risk Rating:
🔴 High Risk
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