Crypto wallet used to store loot from $700,000 fraud, court told

A 25-year-old company director has been denied bail this afternoon after being charged with fraudulently obtaining $700,000 from a car dealer and storing them in a “crypto wallet,” to which only he has access.

Luke John Milton from Rabat was arraigned before magistrate Caroline Farrugia Frendo this afternoon by Inspector Anthony Scerri, assisted by lawyers Karl Muscat and Francesco Refalo from the Attorney General’s office.

Milton, who is listed as a director of Goldcar Operations, No Deposit Cards Malta and Zing Cabs, was accused of fraud in excess of €5,000, money laundering, other fraudulent gains, misappropriation, theft of cryptocurrency, aggravated by value, violently resisting arrest and being in possession of items used for fraud. He was also accused of handling stolen goods.

Prosecutor Karl Muscat explained to the court that the man had been involved in cybercrime whereby his victim was convinced to invest €5000 but that some $700,000 was eventually taken from him. The accused had then stored the money in a crypto wallet that only he could access. Milton had not cooperated with the police, and the money has so far not been recovered, said the prosecutor.

The police are insisting that the money had been transferred to the accused's crypto wallet.

Defence lawyer Matthew Xuereb, appearing for the accused together with lawyer Charles Mercieca, described the case as “a storm in a teacup and a purely civil matter.” The alleged victim had approached the accused and taken him out to dinner, Xuereb said. Whilst performing an online trade using a mobile phone, something had gone wrong, and the money was lost, said the lawyer. He informed the court that a criminal complaint had also been filed against the victim.

All the evidence was preserved by the police, argued the lawyer, requesting bail. “Electronic devices were seized, and an inquiry is underway,” he pointed out.

Lawyer Charles Mercieca explained that there was also no way to access to the account as the mobile phone was in police possession, and he had no access to his e-wallet. He argued that the accused was the victim of a mise en scene and had been defrauded by the victim, who was also being investigated.

It was unfair for the prosecution to object to bail on the grounds of the gravity of the charges, he said. “It is the prosecution which chooses the charges so that we come here and use the gravity of the offence as a reason to object to bail…this should not happen,” said the lawyer, pointing out that the defence had no control over the charges issued.

The accused had ties to Malta, is Maltese and has a fixed residence, said the defence. Milton was ready to bind himself not to use cryptocurrency exchanges whilst on bail, added his lawyers.

The court, after hearing the lawyers’ and prosecutors’ arguments, denied bail at this stage due to the fear of tampering with evidence and the gravity of the crime alleged.