Dubai: The Dubai Civil Court of First Instance ordered a defendant to return $468,332 worth of digital currencies, or its equivalent in Dirhams, to its owner who was subjected to an electronic phishing scam that resulted in the withdrawal of funds from his digital wallet.
The court also ordered him to pay Dh50,000 in compensation for moral damages, after it was proven, by a final criminal ruling, that he had misappropriated part of the currencies that were transferred through a series of digital wallets to his wallet on one of the cryptocurrency trading platforms.
In detail, the incident began when the plaintiff was browsing social media platforms and came across a fake link on the X platform impersonating a well-known platform in the field of digital assets. According to what he stated in his lawsuit, he clicked on the link, followed the required procedures, and entered his data, only to discover later that his entire balance of digital currency had been withdrawn, the value of which he estimated at the time of the incident to be about $803,000.
The wallet owner promptly notified Dubai Police, and the Virtual Assets Crimes Unit took over tracking the digital movement of the stolen currencies, from the moment they left the plaintiff's wallet until part of them reached a wallet linked to the accused.
Technical analysis revealed the transfer of funds through a series of decentralised wallets and successive swaps between different cryptocurrencies, in a path that ended with the stabilisation of units worth approximately $468,332 at the time of the transaction, within a centralised digital wallet registered in the name of the accused on one of the platforms designated for this purpose.
The examination was not limited to tracking the transfers, but also included the defendant’s phone, as the electronic evidence report revealed the installation of applications specialising in cryptocurrency trading, along with emails exchanged with a trading platform regarding transfer operations, as well as communication via the Telegram application to inquire about the level of risk of a digital wallet address, which turned out to have been used as an intermediary link in the path of transferring the seized currencies before they reached the defendant’s wallet.
The Public Prosecution referred the accused to criminal trial on charges related to possessing items obtained from a crime under circumstances that suggest their source is illegitimate, and dealing in digital and virtual currencies without a license.
The Court of First Instance sentenced him to six months in prison, fined him an amount equal to the value of the money involved in the crime, confiscated the phone used in the two crimes, and deported him from the country. Then the Court of Appeal amended the prison sentence to one month, and upheld the proportional fine, confiscation, and deportation.
After the criminal ruling became final, the owner of the currency filed his civil lawsuit demanding the return of the equivalent of $803,000, in addition to Dh250,000 as compensation for moral and psychological damages.
The civil court explained that the final criminal ruling has legal force before the civil judiciary regarding what it decided in a necessary manner concerning the occurrence of the crime, its legal description, and its attribution to its perpetrator. Therefore, it adhered to what was proven in it regarding the accused’s seizure of a portion of the digital currencies owned by the plaintiff, after they were transferred through a series of transfers to his wallet.
It concluded by obligating the accused to return the sum of $468,332, or its equivalent in UAE Dirhams, as it represents the value of the funds that were proven to have been seized and were not returned or recovered.
In the compensation claim, the court found that the seizure of the funds caused the plaintiff moral damage represented by psychological pain, sadness and regret as a result of losing his money, and estimated the compensation for these damages at Dh50,000, instead of the Dh250,000 he had requested.