Ex-Vipstar exec linked to alleged large scale crypto fraud in Japan

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Authorities in Japan arrested two people accused of defrauding an IT firm of around JPY78 million (US$712,000) worth of cryptocurrency, The Mainichi reported.

Yuto Onitsuka, 25, a former Vipstar Inc. employee, and Takuma Sasaki, 28, an unemployed Tokyo resident, face charges of committing computer fraud and violating the Act of Punishment for Organized Crimes and Control of Crime Proceeds.

Vipstar is a hybrid proof-of-stake, and proof-of-work chain launched in early 2018. The project claims it primarily aims at facilitating cross-border donations.

According to the Metropolitan Police Department’s Cybercrime Control Division, the suspects made 12 unauthorized entries into a crypto trader’s account managed by Vipstar in October 2018, and then transferred the funds into their own accounts. The alleged stolen crypto came from the company’s working capital.

The fraud was discovered after Vipstar came to the police a month later for help. The investigation revealed that Onitsuka, who was the chief technology officer of the IT firm at the time, was in a position to get customers’ accounts and password details.

The Metropolitan Police Department’s Cybercrime Control Division also reported that the duo never met in real life, but they built a relationship for years over the internet. Authorities said the two admitted to the acts, with Onitsuka saying he did it because he didn’t agree with the management policy of the president, which made him decide to ruin the company.

Sasaki, who said he only followed Onitsuka’s instructions, reportedly withdrew about JPY6 million worth of BTC to pay off his debts, and go on a vacation.