Chinese Police Department and Huobi Accused of Unlawful Freezing and Transfer of Assets by A Centralized Crypto Exchange

The exchange has its headquarters and servers out of Chinese police’s jurisdiction, and claims that the confiscation of assets is unlawful.

A centralized crypto exchange that transferred a total amount of 5 million U and 6000 ETH to Huobi from Binance, recently discovered that their assets have been confiscated by the Chinese mainland police. Huobi, which is only meant for overseas users, and one that regularly block mainland Chinese users’ IP, is also accused by this centralized exchange of abetting Chinese police department in this ‘crime’.

According to the owners of the exchange, the legal person representing this centralized crypto exchange is Taiwanese, the company is registered in Canada, and the account KYC information is Taiwanese. Due to business needs, starting from 2022-04-05 17:34 HRS, the exchange transferred a total amount of about 5 million U and 6000 ETH to Huobi exchange from Binance.

“Our platform is a centralized crypto exchange. After the user deposit their assets to the exchange, the exchange will receive payment from the user address to the hot wallet and cold wallet. All assets are owned by all exchange users. The purpose of withdrawing assets from Binance to Huobi was to provide users with more hedging liquidity. There are a total of 13 operations, this account has no record of opening positions, and the assets are the assets of the users of the platform”, said one of the executives, while accusing that the Chinese police have extrajudicially confiscated their digital assets. While speaking to the press, the executive also divulged all the relevant information.

“Registration information of Huobi account is associated with the email jhjggoy at gmail dot com. The company’s legal person’s name is Yang X, who is Taiwanese. We have also received the account freezing information”, he added.

At the press meet, the executives showed all the pertinent documents to the press.

According to them, the company’s business license, legal person information, and all related details have been provided to the police. The file directory contains Power of Attorney, KYC Power of Attorney, Power of Attorney with company seal, Company license and KYC information, Huobi account’s KYC, including ID card, corporate passports, company licenses, articles of association, licenses, etc. Communications with the police include: Police officer certificate, case filing decision (Grapefruit Alliance), letter of assistance in investigation, content of correspondence with the police.

However, the executives also maintained that the police will not reply to emails, and will not provide any information on the phone on the grounds of confidentiality, and freeze all their assets without evidence.

The executives showed proof of communication with the police. They added that they made six phone calls to the concerned department, but to no avail.

” Police claim that a sum of black money deposit to our exchange. After many attempts at communication, the police department issued a letter of assistance in the investigation, asking us to assist in the investigation. But the address sent to us is not the address of our platform, and we cannot provide detailed user information from KYC system for this address. We communicated with the police again, expressing that this address is not ours, and asked the police to provide higher-level currency transfer information, so that we can assist in the investigation. The police did not provide the information on the grounds of confidentiality, and there was no evidence to freeze our assets

The executives also narrated the series of events that took place in July and August to the international press.

On July 27, the police brought three of their former employees to Jiangxi to assist in the investigation in a different lawsuit against Grapefruit Alliance, and were subsequently detained for casino crimes. These 3 former employees have now been acquitted. On August 13, the exchange’s KYC representative Lin X sent a lawyer’s letter to Huobi.

In the next few days, the police asked Huobi to transfer the assets in their account to the police’s wallet address. If Huobi did not cooperate, the police would charge founder Li Lin and threaten Li Lin. Li Lin did not want to offend him and shared the information with this crypto exchange.

“The company’s legal person is Yang XX from Taiwan, KYC person is Taiwanese Lin X, and the company is registered in Canada. The company’s website is only for overseas users, and the IPs of mainland users are banned. Outside the jurisdiction of the mainland, the mainland police have no right to interfere. Huobi froze assets without evidence, forcibly plundered it, and it is a case of robbery”, added one of the executives.

According to them, Huobi authorities said that they will cooperate with the police to transfer the assets of their account to the police, despite the police having no concrete evidence.

“As victims, we would like to say to Huobi that they are the accomplices of robbers. Our company actively cooperates with the investigation team of the mainland police. So far, the police have not provided any evidence, and did not provide the user address for us to cooperate with the investigation. We have communicated many times to provide the address. We use it to extract user information, and the police have kept it confidential. Clearly Huobi are making money illegally”.

“We firmly oppose Huobi transferring our company account assets to the police without any evidence provided by the police. Huobi are making money illegally, and what Huobi is doing is also completely unethical”, they went on to add.

The police officers handling the case, as per the contact information provided by Huobi and shared by this crypto exchange with the press here, are Liu Junhua, Liu Zhongpeng, Hu Xiangjia and Peng Donggen.  

Similar Articles


Most Popular