A former manager for major crypto exchange Huobi is facing prosecution in Hong Kong for allegedly running an insider trading operation that eventually netted him $5 million in Tether (USDT).
Huobi has accused Chen Boliang, 34, of accessing its computer systems to fraudulently create a $20 million credit line with his ‘father’s’ account. Once set up he traded against his corporate account using inside information gleaned from his position in the firm, the company alleges.”
As reported by the Financial Times (FT), he was arrested in May 2020 and has been charged with six counts of accessing Huobi’s computers and one count of dealing the proceeds of crime. Huobi claims Boliang carried out his insider trading scheme in February and March of 2020. He was first reported to the police the following April.
Huobi said: “Mr Boliang Chen’s employment with Huobi Global was terminated in May 2020. We have no further comments pertaining to the charges against Mr Boliang Chen and believe in the administration of justice by the HK Special Administrative Region,” (via FT).
Boliang has requested a preliminary inquiry for next week where it will be decided if there is sufficient evidence to warrant a trial. For the time being, he is currently on a $25,000 bail.
Both Huobi and OpenSea suffer insider trading
Protos reported in early June how OpenSea was also hit by a case of insider trading.
The NFT marketplace found itself under the spotlight in 2021 when keen-eyed Twitter users found that the company’s head of product, Nathaniel Chastain, was allegedly hoovering up NFTs as they were placed on the homepage before selling them on for profits upwards of 90% to 500%.
It was then announced that OpenSea fired an unnamed employee in response. Unsealed documents from the FBI later revealed how Chastain had been arrested and charged with wire fraud and money laundering.
Prosecutors said that between June and September 2021, Chastian bought multiple NFTs based on the knowledge that they, or others by the same ‘artist’, would soon appear on the homepage before attempting to hide his profits.
Edit 15:45 UTC, June 23: Updated headline to reflect the fact that Chen Boliang no longer works for Huobi.
Following the publication of this article, Huobi contacted Protos with the following statement.
“Mr. Boliang Chen’s employment with Huobi Global was terminated in May 2020. We have no further comments pertaining to the charges against Mr. Boliang Chen and believe in the administration of justice by the HK Special Administrative Region.”