Cryptocurrency news

Cryptocurrency News: UK Courts May Freeze Stolen Blockchain – Scammers Deal | United Kingdom | News

In a landmark ruling, the High Court said World Freezing Orders (WFOs) could be used to prevent the transfer of disputed cash while a decision is made on who, if any, is at fault. WFOs have been used for years in conventional criminal cases – while a court decides who is the rightful owner of the disputed goods.

But victims of crypto crimes were often powerless to get their money back as blockchains are stolen by anonymous scammers who could be located anywhere on the planet.

Questions had arisen as to whether WFOs could be applied in cases of suspected cryptocurrency theft – due to the difficulty of assessing who was accused of stealing them.

But in a landmark case, the High Court ruled that crypto-assets, such as Bitcoin, count as property for the purposes of the order.

He was also satisfied that he had jurisdiction to grant the exclusive injunction and WFO against an unknown person, as the description of the fraudsters was considered sufficiently clear to establish who was and was not included in the group concerned.

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And if the accused was unknown, the court will instead issue a third-party disclosure order (called a Bankers Trust Order) against the cryptocurrency exchanges.

The case concerns the alleged theft of £ 250,000 of Bitcoin from Ion Science Limited and its owner Duncan Johns.

According to law firm RPC, the case “was seen as a possible model for future claims, especially given the increased prevalence of cryptocurrency fraud, alongside its increasing publicity and rapid growth. value”.

He added: “The court has demonstrated that it is prepared to treat crypto-assets as property and grant exclusive injunctions when those assets are misappropriated, as well as third-party disclosure orders to determine the identity of the or fraudsters. “

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The news emerged as WFOs have become an increasingly mainstream means of tackling cross-border crime in recent years.

In the past four years alone, around £ 9 billion has been assets frozen by the High Court.

Freeze orders are used by courts to prevent suspected criminals from hiding their assets and potentially avoiding any obligation to compensate their victims.

British courts are unique in that they can issue freezing orders covering assets anywhere in the world.

These “Mareva injunctions” are made possible by the acceptance of English law in jurisdictions around the world.

As a result, litigants in international disputes are keen to take their cases to the UK as they have a better chance of recovering stolen assets.

A review of legal journals shows that hundreds of WFOs have been brought in by law firms to London in recent years, while the volume of orders has also increased.

However, they have not always been successful.

In 2018, the Republic of Djibouti secured a £ 73million WFO against Abdourahman Mohamed Mahmoud Boreh, but it later emerged that the date of the telephone transcripts used as evidence had been changed.

This apparent falsification of evidence was known to Djibouti representative Peter Gray of the Gibson Dunn law firm.

Mr Gray was found to have willfully and dishonestly misled the court and was struck off his legal position in May 2021.

Despite these setbacks, it is likely that freeze orders will remain an essential legal tool given the ease with which money and assets can be moved around the world.

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