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FEB 10, 2024

Thailand’s SEC takes legal action against former Zipmex CEO

by CoinNess Global

The Securities and Exchange Commission (SEC) of Thailand has initiated legal proceedings against Akarlap Yimwilai, the former director and CEO of Zipmex Thailand.

Failure to disclose vital information

The Commission set out its allegations against Yimwilai in a statement published to its website on Thursday. The allegations revolve around Yimwilai’s purported failure to disclose vital information during his tenure, resulting in financial losses for Zipmex customers.
According to the SEC’s investigation, Yimwilai allegedly transferred cryptocurrency from Zipmex Thailand’s wallets to overseas digital wallets without prior disclosure to customers.

Unauthorized digital asset movements

The SEC’s findings indicate that customer assets held in Zipmex Thailand’s Z Wallet were moved into overseas digital wallets before any official announcement regarding changes in terms and conditions. This conduct, the regulator asserts, contradicts the information provided by Zipmex Thailand, constituting fraudulent misrepresentation. Yimwilai served as CEO of Zipmex Thailand from August 2018 to November 2023, as per his LinkedIn profile.
This deceptive action misled users regarding the security of their assets, the SEC claims, prompting the Commission to charge him with violating Section 82 of the Digital Asset Business Operation Act B.E. 2561.
The SEC’s accusations extend to Zipmex Thailand’s submission of inaccurate reports on customer assets and violations of regulatory requirements. The regulator contends that the reports submitted by Zipmex Thailand were inconsistent with independently verified information.

Inviting further legal action

In response to these allegations, the SEC has forwarded charges against Yimwilai to the Office of the Public Prosecutor (OPP) for further legal proceedings. The SEC has also filed a formal complaint against Yimwilai with the Office of the Provincial Crime Suppression Division, indicating a pursuit of additional legal action. The determination or otherwise of legal liability will be a pivotal step in this process, emphasized by the SEC.
Zipmex Thailand, a subsidiary of Singapore-based Zipmex under the leadership of Marcus Lim, obtained approval to operate from the Ministry of Finance and SEC in 2020. The company reportedly came under scrutiny from financial regulators over its acquisition by V Ventures in 2023. V Ventures backed out of the $100 million buyout of the company last year, which would have included the return of customer deposits. It claimed that Zipmex had not lived up to the terms of the buyout contract.
On Feb. 2, the Thai SEC directed Zipmex to temporarily suspend its digital asset trading and brokerage services, granting the firm a 15-day period to adhere to regulatory guidelines.
Earlier reports had highlighted Zipmex’s application for court protection amidst a wave of bankruptcies among crypto lenders. In November 2023, Zipmex proposed a restructuring plan to reimburse creditors at $0.30 on the dollar, encountering resistance from key stakeholders. The initial offer stood at three cents on the dollar, with the potential to increase to 30 cents in the event of optimized capital recovery.
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