A Crypto.com employee accidentally paid AU$10.5 million to an Australian woman who had asked for a refund of AU$100.
The money had supposedly already been spent at that point, and the transfer error could not be undone, a court document reveals that it took 7 months for the cryptocurrency exchange platform to realize its blunder. Thevamanogari Manivel, the beneficiary, is accused of transferring money to bank accounts owned by her and her family without informing Crypto.com. According to Crypto.com, Manivel allegedly used the funds to purchase her sister a luxurious million-dollar mansion complete with a home theater and gym.
Australia’s Victorian Supreme Court member Justice James Elliott handed down a default decision in the case on Friday. This was required as a result of Manivel and other listed defendants, including her sister Thilagavathy Gangadory, failing to reply to a court summons, as claimed by Crypto.com in the court document.
Crypto.com is requesting that the court order the sisters to give up the home and repay the money, along with any sales proceeds and court costs. The judge agreed, directing Gangadory to sell the home, which RealEstate.com has estimated to be worth $1.37 million, and to pay a minimum of $1.35 million plus interest of $27,369.64.
The cryptocurrency exchange business initially froze Manivel’s bank account and then all the other bank accounts to which Crypto.com claimed its money had been improperly transferred after realizing its error. Among other grievances, the exchange alleges that Gangadory was “unjustly benefited” as a result of their mistake.
The legal team at Crypto.com contacted the attorneys for Manivel in an effort to serve court papers to the sisters. Her attorneys reportedly only acknowledged receipt once. Gangadory allegedly never responded to attempts to serve her with court paperwork, thus Crypto.com had less success contacting her.
Elliott stated in his default decision that this lack of reaction was troubling and suggested that she might not have received the materials. Ultimately, he determined that an email to Gangadory with a link to court documents constituted adequate notice, and he granted Crypto.com’s request for a default judgment.
However, the judge highlighted in his order that the defendants still have time to appeal the ruling. The matter would be reopened in October to see how much money would be recovered for Crypto.com. The sisters might be found in contempt of court if they keep skipping appearances. The press was informed by Crypto.com that Gangadory is currently seeking legal counsel on the default judgment by Manivel’s attorneys.
Problems with serving court documents digitally
There is disagreement in the default judgment as to whether Crypto.com went far enough to contact Gangadory before the order.
The issue arose because Gangadory could have only read the court papers handed to her if she had accessed her personal email and clicked a OneDrive link. According to the legal team for Crypto.com, the court documents were over 20 megabytes in size and were therefore too large to send as an attachment to an email using Microsoft Outlook, therefore they had to be sent using OneDrive.
Elliott was unable to check the drive to make sure the court documents had been delivered since the link had been configured to expire after 30 days for security purposes. To dispel the misunderstanding, Crypto.com’s attorneys had to provide proof that the papers had been uploaded to OneDrive, the link had been live for 30 days, and their company’s previous policy called for OneDrive links to expire after 30 days.
Australian law now allows court documents to be attached to emails, but the court has never made it clear whether doing so is equivalent to actually attaching the documents.
Elliott claimed that that issue has also not been fully resolved by this case. He advised courts to decide on a case-by-case basis in the future when it is appropriate to serve court documents via email links
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