ZKasino Scam: Suspect Arrested, Dutch Authorities Seize $12.2M

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Key takeaways:

  • An individual believed to be connected to the ZKasino online gambling platform scam was taken into custody by Dutch authorities.
  • Dutch officials claim that the smart contract indicates the site never intended to repay the funds.

An individual believed to be connected to the ZKasino online gambling platform scam was taken into custody by Dutch authorities.

Suspected of money laundering, embezzlement, and fraud, the 26-year-old was taken into custody by the Fiscal Information and Investigation Service (FIOD) on April 29.

As reported by FIOD on May 3, the Dutch authorities confiscated cryptocurrency, real estate, and high-end automobiles valued at around 11.4 million euros ($12.2 million).

In the ZKasino fraud case, investors lost at least $33 million in digital assets; this is the first arrest in the investigation. Users were initially guaranteed a 30-day return on their investment by the company. 

Dutch officials claim that the smart contract indicates the site never intended to repay the funds. For investigative purposes, the suspect’s imprisonment was extended by a further fourteen days.

Although the suspect’s identity has not yet been established, some members of the X crypto community have made assumptions about it.

When ZKasino first launched, it advertised itself as a new blockchain-based gaming site that accepted deposits from investors and offered profits in as little as one month. On April 20, the site went live and attracted 10,515 ETH from 10,000 investors.

On April 20, investor anxiety increased when it was revealed through an on-chain transaction that ZKasino had transferred all 10,515 ETH to the Lido staking protocol. Additionally, users saw that it had altered the language on its website, eliminating the clause stating that the ETH “would be returned.”

ZKasino stated in a March X post that it has secured a $350 million Series A financing round with support from venture capital firm Big Brain Holdings and cryptocurrency exchange MEXC, among others.

After receiving an offer from the platform for a pro-rata token distribution, Big Brain Holdings later stated that it had not invested in ZKasino, “which appears to be fraudulent.”

In a federal court in Seattle, Binance founder CZ was sentenced to four months in prison. Prosecutors had originally sought a sentence of three years in jail for CZ. US investigators’ extended investigation culminated in Binance and its CEO being held liable last autumn, as shown by the prison term.

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