The Dubai Civil Court of First Instance ordered a man who received part of the cryptocurrency stolen from an electronic wallet to repay $468,332, or its equivalent in UAE dirhams.

The court also ordered the defendant to pay the claimant Dh50,000 in compensation for moral damages. The ruling followed a final judgment in a criminal case establishing that the defendant had taken possession of some of the claimant’s cryptocurrency after it was transferred through several wallets.

Scam Began With a Fraudulent Link on X

The case began when the claimant came across a fraudulent link while browsing social media platform X, formerly Twitter. The link purported to belong to a well-known digital asset platform.

According to the claimant, he clicked on the link, followed the requested steps and entered his details. He later discovered that the entire cryptocurrency balance in his wallet had been withdrawn.

The stolen assets were valued at about $803,000 at the time of the incident.

Dubai Police Trace Stolen Cryptocurrency

The wallet owner immediately reported the incident to Dubai Police, whose virtual asset crimes unit began investigating and tracing the stolen cryptocurrency transfers.

Officers tracked the assets from the moment they left the claimant’s wallet and established that some of the funds had been transferred to a wallet linked to the defendant.

Technical investigations found that the stolen cryptocurrency had been moved through a series of decentralised wallets and converted into other cryptocurrencies in several stages.

Eventually, some of the assets, valued at about $468,332 at the time of transfer, were deposited into a centralised wallet registered in the defendant’s name on a cryptocurrency trading platform.

Key Evidence Found on Defendant’s Mobile Phone

The investigation was not limited to financial transactions, with experts also examining the defendant’s mobile phone.

A digital evidence report found that several specialist cryptocurrency trading applications were installed on the device.

Investigators also discovered emails between the defendant and a trading platform concerning cryptocurrency transfers.

A review of Telegram messages further showed that the defendant had inquired about the risk level of a digital wallet address. Investigators found that the address had been used as an intermediary in transferring the stolen assets to his wallet.

Jail Term, Fine and Deportation From the UAE

After completing its investigation, Dubai Public Prosecution referred the defendant to the Criminal Court on charges of possessing assets obtained under suspicious circumstances and showing signs of an unlawful origin, as well as conducting cryptocurrency and virtual asset trading without a licence.

The Criminal Court of First Instance initially sentenced the defendant to six months in prison, fined him an amount equal to the value of the assets linked to the offence, ordered the confiscation of the mobile phone used to commit the crimes and ordered his deportation from the UAE.

The Court of Appeal later reduced the prison term from six months to one month but upheld the fine, confiscation of the mobile phone and deportation order.

Claimant Seeks $803,000 Repayment and Dh250,000 Compensation

After the criminal judgment became final, the cryptocurrency owner filed a separate civil claim seeking repayment of assets worth $803,000.

He also sought Dh250,000 in compensation for the emotional, psychological and moral harm caused by the fraud.

The Dubai Civil Court said the final criminal judgment regarding the occurrence of the offence, its legal classification and its attribution to the defendant was also legally binding in the civil proceedings.

The court therefore held that the defendant’s possession of part of the claimant’s digital assets had been established by the final criminal judgment.

Dubai Court Orders $468,332 Repayment and Dh50,000 Compensation

After reviewing the case, the court ordered the defendant to repay the claimant $468,332, or its equivalent in UAE dirhams. The amount represented the value of the assets proven to have been taken by the defendant and which had not been returned or recovered.

Addressing the claim for moral damages, the court said the loss of the investment had caused the claimant psychological distress, grief and regret.

However, instead of the requested Dh250,000, the court awarded Dh50,000 in compensation for moral damages.

Although about $803,000 in cryptocurrency was initially stolen, the repayment order against the defendant covers only the portion of the assets that investigators and the courts proved had been transferred to and taken by him.