Bitgrail’s founder, Francesco Firano, is accused of committing a fraud related to the massive hacking in 2018.
The Italian authorities found Bitgrail’s founder responsible for fraudulent activity related to the platform’s $150 million hack in 2018.
Francesco Firano, the sole director of the now-defunct Bitgrail crypto-currency exchange, is accused of appropriating client funds before reporting the theft of crypto-currencies from the platform.
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According to an announcement on December 21 by the Postal and Communications Police, a cyber-crime unit of the Italian State Police, Firano kept the platform intact for months despite identifying a major security breach related to the Nano cryptomone:
„By keeping the platform open, despite identifying illicit withdrawals of Nano coins, and without informing the Nano team […] FF continued to attract new users, which grew from 70,000 to about 217,000 in a few months, benefiting from the reputation of being the first and only Italian exchange to deal with [Nano]“.
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Firano subsequently denied the police allegations, claiming that the authorities provided false information on the matter. „The police went into hiding instead of correcting the articles,“ Firano argued on Twitter. The executive also said he was not arrested by the police.
The announcement appears to indicate that Firano withdrew 230 Bitcoin (BTC), worth 1.7 million euros or about 1.9 million dollars at the time, just three days before reporting Nano’s largest theft in previous months. The amount stolen from BTC was traced to a company in Malta called The Rock Trading, allegedly owned by Firano. Although authorities said there were attempts to convert the money, most of the funds remained in the company’s accounts. Authorities said the hackers who stole Nano remain unidentified. In a preliminary court order Firano was prohibited from holding management positions or conducting business, but his freedom of movement is not otherwise restricted.
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The latest news comes after years of controversy surrounding the attack on Bitgrail, one of the largest hacking incidents in Italy. In February 2018, Firano officially announced that 17 million Nano, formerly known as Raiblocks, had been stolen. Subsequently, the developers of nano provided an official commentary showing that Firano requested that the altcoin ledger be modified the next day after the hack was reported.
In January 2018, the Italian Bankruptcy Court sentenced Firano to return most of the assets to his clients after local authorities seized more than $1 million in Firano’s personal assets.