Tokenize Xchange Founder Faces $60 Million Collective Lawsuit

More than 270 former customers of collapsed cryptocurrency exchange Tokenize Xchange have filed a representative action in the High Court, seeking $60.5 million in damages from founder Hong Qi Yu and his wife, Erin Koo Kee Hoon, over alleged fraudulent misrepresentation and misappropriation of client funds.

The lawsuit, led by six Singapore residents, represents 272 account holders of the platform. Court-appointed interim judicial managers reported in September that Tokenize’s operator, AmazingTech, owed customers $266.3 million but held only $2.6 million in realisable assets, less than 1% of liabilities. The claimants allege that the shortfall of $263.7 million was fraudulently misappropriated by Hong and Ms Koo.

Law firm Dauntless Law Chambers, acting for the claimants, said the defendants must indicate by Dec 8 whether they intend to contest the suit, with a defence due by Dec 15 if they do. 

Tokenize announced its closure on July 20 after the Monetary Authority of Singapore (MAS) rejected its licence application. The firm had been operating under an exemption. Days later, MAS and the Singapore Police Force’s Commercial Affairs Department confirmed investigations into AmazingTech for potential offences, including fraudulent trading.

Hong was separately charged in court on July 31 with fraudulent trading. 

AmazingTech was placed under interim judicial management on Aug 15 and was wound up by the High Court on Sept 30.