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HomeLaw & PoliticsEx-Coinbase executive brother enters guilty plead in crypto wire fraud case

Ex-Coinbase executive brother enters guilty plead in crypto wire fraud case

According to the announcement made on September 12 by Damian Williams, the US Attorney for the Southern District of New York, Nikhil Wahi, the brother of a former chief product officer at Coinbase Global, Inc., has recently admitted guilt to one count of conspiracy to commit wire fraud. 

Damien Williams of the U.S. The US Attorney’s Office in New York released a statement:

“Less than two months after he was charged, Nikhil Wahi admitted in court today that he traded in crypto assets based on Coinbase’s confidential business information to which he was not entitled.”

For the first time ever, a defendant in an insider trading prosecution using cryptocurrency marketplaces has acknowledged his guilt. The Southern District of New York will continue to aggressively monitor frauds of all shades and will adapt as technology develops, Williams said, adding that today’s guilty plea should serve as a lesson to individuals who dabble in the cryptocurrency markets.

 Wahi Brother profits from insider trading information

Nikhil Wahi, the brother of former Coinbase product manager Ishan Wahi, pled guilty to committing bitcoin wire fraud using insider knowledge obtained from his brother. Nikhil Wahi used accounts on centralised exchanges held in other people’s names to conceal his purchases of cryptocurrencies ahead of Coinbase listing announcements. He then transferred money, cryptocurrencies, and the proceeds of their scheme through a number of anonymous Ethereum blockchain wallets. To further hide his involvement in the fraud, he also frequently established and used brand-new Ethereum blockchain wallets with no previous transaction history.

Mr. Williams commended the Federal Bureau of Investigation’s investigative work. He also thanked the US Securities and Exchange Commission (SEC) and the US Justice Department’s National Cryptocurrency Enforcement Team for their cooperation in filing separate civil lawsuits against the Wahi brothers.

The Bureau’s Securities and Commodities Fraud Task Force is in charge of this situation. The prosecution is being led by Assistant United States Attorneys Noah Solowiejczyk and Nicolas Roos.

 

Ex-Coinbase executive brother enters guilty plead in crypto wire fraud case
Ex-Coinbase executive brother enters guilty plead in crypto wire fraud case

Unauthorized Coinbase Transaction

When Nikhil is sentenced in December, he could be sentenced to up to 20 years in jail. Williams claims that he has also been made to repay the funds from the unauthorised Coinbase trade. Ishan, Nikhil, and their friend Sameer Ramani were accused in July by the Justice Department of wire fraud conspiracy and wire fraud involving crypto insider trading. The three were also charged by the Securities and Exchange Commission.

While employed by the exchange, Ishan allegedly shared insider information about upcoming Coinbase listing announcements with Nikhil and Sameer in order to take advantage of the listings by buying the tokens before they were live on Coinbase. In August, Ishan entered a not-guilty plea to the DOJ’s allegations. Given that his brother has admitted culpability, it is uncertain how Ishan’s case will develop and whether he would pursue the insider trading claim.

The DOJ stated Nikhil implicated his brother Ishan and acknowledged getting information from him. Then, Nikhil allegedly used numerous cryptocurrency wallets in other people’s names to hide his insider trading.

Read more at Cryptoshrypto:
Fidelity to allow bitcoin trading to brokerage customers: Report

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