Nigerian Court Approves Arrest of Six Over Crypto Bridge Exchange Fraud

A Nigerian high court has authorized the arrest of six individuals accused of promoting a fraudulent cryptocurrency platform that allegedly defrauded investors out of 1 billion naira (about $620,000), according to a report from The Cable on April 24.

The Federal High Court in Abuja granted the Economic and Financial Crimes Commission (EFCC) permission to detain the six suspects, who reportedly used their firm, ST Technologies International Limited, to advertise and solicit investments in Crypto Bridge Exchange (CBEX). As of publication time, the individuals had not yet been taken into custody.

The case adds to a series of actions Nigerian authorities have taken against crypto exchanges and their representatives. In February, Nigerian officials detained two Binance executives visiting the country to discuss the company’s operations.

Frustrations with CBEX erupted earlier this month after users reported being unable to withdraw their funds. The backlash escalated into real-world confrontations, with investors raiding the company’s local office in Ibadan and taking office equipment in an effort to recoup losses.

Meanwhile, Nigeria’s case against Binance is ongoing. Tigran Gambaryan, a U.S. citizen and former Binance executive, was held in Nigerian custody for eight months on charges of tax evasion and money laundering before being released to U.S. authorities.

Binance’s legal representative argued in court that the Federal Inland Revenue Service (FIRS) improperly served court documents to the company via email. Binance, which has no physical presence in Nigeria, is registered in the Cayman Islands, and Ikwuazom said that the FIRS failed to seek proper court approval to serve legal papers to an overseas entity.

Authorities accused the world’s largest cryptocurrency exchange of fueling the country’s currency crisis, with government officials linking Binance’s operations to the volatility of the Nigerian naira.

The FIRS initially filed its lawsuit in February, claiming Binance owed $2 billion in back taxes and should be held accountable for $79.5 billion in damages, alleging the exchange’s operations distorted the naira and harmed the local economy. The agency further claims that Binance has a “significant economic presence” in Nigeria, which would make it liable for corporate income taxes for 2022 and 2023. It is also seeking penalties and interest totaling nearly 37% annually on unpaid tax liabilities.