The three young engineers prosecuted for fraud because of their smart contract project, Arbiape, hosted on Arbitrum, this derivative of the Ethereum blockchain, were finally sentenced on Wednesday June 21 for deceptive commercial practice and money laundering, noted Zdnet. Fr.
They had “lost their footing”
The magistrates of the Paris court have indeed pronounced the requalification of the offense of fraud, a good point for the defense. “These are three young people in their twenties who find themselves illegitimately with 2.5 million euros, observed at the hearing on May 24, Me Romain Chilly, one of the defendants’ lawyers. So yes, they lose their footing a bit, they think they will be able to keep some of the money. This demonstrates possible bad faith, not fraudulent maneuvers.”
The prosecution had however anticipated such a movement, stressing in its requisitions that failing to condemn the defendants for fraud, the judges had before them “obviously a misleading commercial practice with this contract served in an unintelligible manner”. Deputy prosecutor Louise Neyton then requested suspended prison sentences and large fines.
Fines matched in part with the suspended sentence
In detail, the two main defendants, Slimane and Pierre-Etienne, respectively receive a fine of 50,000 euros, including 40,000 euros suspended, and a fine of 30,000 euros, including 20,000 euros with reprieve. In addition to the reclassification of the scam as a deceptive commercial practice, they are acquitted for part of the money laundering offenses referred to, but convicted on this count for sending part of the funds to the Tornado Cash mixer.
As for the third defendant, Gabriel, he is condemned for the only facts of money laundering to a fine of 10,000 euros suspended. The court finally ordered the publication on several press titles – including Zdnet.fr – of a judicial press release relating to the judgment of this case.
In September 2021, these three engineers had managed to get their hands on 925 ethereum, or around 2.5 million euros, after increasing the withdrawal fees for their smart contract from 2% to 100% for about ten minutes. . The sudden rise had surprised a Singaporean trader, who had invested nearly a thousand ethereum in this Arbinyan clone before asking after 27 seconds for the contract to be closed, thus losing his entire initial bet.