The founders of cryptocurrency Turcoin, Sadun Kaya and Muhammed Satiroglu, have been arrested as part of an ongoing investigation over allegations of running a Ponzi scheme. Three other people from the Turcoin project have been released on bail, Hurriyet daily reported on July 3.
Both Satiroglu and Kaya were detained in mid-June but later released on probation. However, their jailing on Monday, signals that the investigators have new more serious evidence against them.
At the beginning of June, several Turcoin investors filed a criminal complaint after the company behind Turcoin, Hipper, suspended bonus payments and the Istanbul customer support center stopped answering calls.
One of the founders, Kaya, appeared to have fled the country with 100 million Turkish lira (more than $21.1 million), raised from Turkish investors. The other founder, Satiroglu denied participation in the illegal activities but had not revealed his whereabouts.
The authorities blocked Turcoin’s Turkish bank accounts.
Kaya has 51% in Hipper while Satiroglu owns the remaining. Both have Cyprus-based companies for management of their investments in the cryptocurrency project.
“I was only a mediator. Our company Hipper does not even have a single dollar in the bank. All the money went to Sadun Kaya’s company in Cyprus,” Satiroglu, told Hurriyet daily.
“I have not fled with the money. I will return all the money to the members if the authorities unblock my bank accounts.”
Turcoin was launched in 2017 with the aim to be Turkey’s national cryptocurrency and was backed by local celebrities. The first investors were granted luxury cars in October.
“Some of the cars were really given away and some of them were there only for show to persuade more people to join the system,” one early investor told Hurriyet.