Frenchman takes on Gold Coast cryptocurrency firm after allegedly losing $800k in failed deal
A French national is suing an Australian cryptocurrency company over an alleged scam that he claims left him close to $800,000 out of pocket after the market soared.
- Alexandre Raffin filed the lawsuit in Australia’s Federal Court
- It’s believed to be the first cryptocurrency fraud case of its kind in Australia
- A spokesman for the accused company said it would be “vigorously defending the allegations”.
Alexandre Raffin, 28, has filed a lawsuit in the Federal Court of Australia against Modern Assets Australia, a cryptocurrency advisory and research firm based on the Gold Coast.
Mr Raffin is accusing the company and its directors, Jonathan Allison and Carlo Sciubba, of breaching their duty of care to him over a lucrative deal to buy a South Korean cryptocurrency called Klaytn.
It is believed to be the first cryptocurrency fraud case of its kind in Australia.
The Gold Coast company was allegedly meant to provide the cryptocurrency to Mr Raffin in exchange for cash, but when the deal fell through, they put him in touch with the person who was supplying them.
About a month later, that same supplier allegedly made off with all the cash and deleted his account.
Since then, the cryptocurrency’s value has gone up 30 times, and had Mr Raffin and his investors received it, they would be sitting on close to $3.7 million.
Mr Raffin is accusing Modern Assets and its directors of not doing their due diligence before putting him in touch with the mysterious seller.
“I’m a pretty tough guy. I’ve become quite desensitised to money through these years in crypto,” Mr Raffin said from his home in Paris.
“But this was hard, even for me.”
‘Wild west’ created by lack of cryptocurrency regulation
Mr Raffin runs a brokerage firm in Paris called GAINS Associates.
The firm pools the funds of investors to purchase cryptocurrency.
Early last year, he entered into a contract with Modern Assets to supply Klaytn, which was worth about 10 cents at the time.
A disagreement between the two parties ultimately led to their contract being torn up, and Mr Raffin being introduced to the company’s mysterious supplier.
Under the terms of a new deal, this man was meant to provide 937,500 units of the cryptocurrency for about $93,000.
But the whole agreement soured when he disappeared with the cash and deleted his encrypted messaging account.
Regulation in the cryptocurrency world has been a key focus in recent months, as investors come to terms with a space that has been called the “wild west” because of a lack of oversight.
While some have made their millions by holding and trading cryptocurrency, others have lost just as much through scammers.
‘Very painful’ losses
Mr Raffin said finding out he was the victim of an alleged scam was devastating.
“I just went to cry on my balcony,” Mr Raffin said.
“I had to take a moment.”
He ultimately decided to pay back his investors mostly out of his own pocket, which he said was “very, very painful financially”.
“At the time it was 80 per cent of my assets,” he said.
“That was very hard to do.”
He hired a blockchain cyber investigation company to find the missing cash, but ultimately filed papers in the Federal Court when the probe was unsuccessful.
Mr Raffin told the ABC he was still not sure whether he and his investors were “tricked”, but said he trusted the Gold Coast-based firm.
“We thought they did their due diligence,” he said.
“Maybe they’re just very good at marketing.”
Mr Raffin said Modern Assets had since refunded its commission fees.
His lawyer, Mark Stanarevic, alleged Modern Assets and its directors had engaged in “unconscionable conduct”.
“They aided, abetted, counselled or procured the misleading and deceptive conduct,” Mr Stanarevic alleged in court documents.
In addition to damages, Mr Raffin is also seeking close to $800,000, which is what the cryptocurrency would have been worth in August last year.
Mr Raffin said he hoped the case would be resolved.
“We just want to make things right for our investors and then move on,” he said.
A spokesman for Modern Assets said it would be “vigorously defending the allegations”.
“Modern Assets Australia denies the allegations in the proceedings,” the spokesman said.
“We have been advised not to comment further.”
The Federal Court is yet to determine the claim.