Court documents state that the recipient used part of the funds to purchase a luxury villa after receiving the million-dollar amount. An apparent error by crypto platform Crypto.com turned an attempt to process a refund of AUD 100 (about US$70) into a hefty AUD 10.5 million bank payment to a customer-owned bank account.
According to a report by local television station 7News, two Melbourne women, Manivel Thevamanogari and her sister Gangadory Thevamanogari, received a deposit of AUD 10.5 million from Singaporean crypto exchange Crypto.com after it mistakenly issued an AUD 100 refund.
Instead of the correct amount of the refund, the employee allegedly accidentally entered the customer's account number in the payment section, resulting in an incorrect transfer to the customer's bank account. Thevamanogari Manivel, who owns the bank account, and her sister Thilagavathy Gangadory went on a shopping spree after the first sister mistakenly received funds in May 2021.
Before the company discovered its error during an audit in December 2021, a large portion of the funds it has already disappeared from its accounts.
The error was discovered seven months later
According to the report, in a bid to recover the funds, Crypto.com has taken legal action against both women.
An Australian court found that, following the erroneous transfer in May 2021, Manivel transferred approximately $10.1 million and $400,000 to two different accounts. In February 2022, funds were withdrawn from both accounts to purchase a property worth approximately $1.35 million in Craigieburn, a suburb of Melbourne.
The incident occurred back in May 2021 but was not discovered until the annual audit in December 2021. Crypto.com has so far reportedly succeeded in its legal battle against the two sisters. After the lawsuit was filed, the Supreme Court of Victoria recently ruled that the house must be sold and the funds must be returned to crypto exchange Crypto.com.
However, it emerged that Manivel had already spent AUD$1.35 million on a five-bedroom luxury home in Craigieburn. The case will return to court in October.
Justin Lawrence of Henderson and Ball Lawyers said:
"There's no doubt that if you saw that in your account, you would know it shouldn't be there, and the onus is actually on you to call the sender and say, look, that shouldn't have come into my account."
Unlike crypto transactions, which are final and irreversible, centralized financial institutions can reverse erroneous transactions. However, given the time it took to discover the error and the fact that the Crypto.com funds were transferred from the original account immediately upon receipt, simply reversing the transaction would be impossible in this case.