Insiders suspect Match Systems of fraud

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Match Systems, a Russian company presenting itself as a blockchain analytics firm, is accused of falsely freezing accounts on cryptocurrency exchanges while pretending to be law enforcement agencies. This information was disclosed by an anonymous employee ‘K’ from the risk department of a prominent exchange with offices in Moscow and Dubai.

Match Systems, also known as Plain Chain, positions itself as a blockchain investigation firm that offers services to recover stolen cryptocurrencies. However, according to the source, the company is suspected of engaging in fraudulent practices by frequently requiring upfront payments for investigations without issuing refunds, regardless of the investigation’s outcome.

“They never refund the advance, citing “we did what we could, here’s a statement of fund movement,”” stated the source.

The upfront payment amounts are said to vary case by case but typically fall within the range of $5,000, according to the informant.

The source estimates that Match Systems’ scheme has affected over five hundred cases based on the serial numbers assigned to each client in Match Systems’ Telegram chats.

In these chats, representatives of Match Systems gather information from clients, ostensibly to streamline the investigation. The data requested includes details such as the location (city, country) of the theft, as well as the addresses of clients and potential cybercriminals.

In truth, according to the source, the collected information is not employed for cryptocurrency recovery. Rather, Match Systems seeks to ascertain whether clients’ cryptocurrencies have been directed to centralized trading platforms (exchanges or exchangers).

“Importantly, stolen assets may end up on the exchange not directly from the initial perpetrators but from entirely innocent third parties,” the source notes.

Upon identifying the arrival of funds at the exchange, Match Systems representatives reach out to the trading platform, pretending to be law enforcement authorities. They request the platform to freeze the funds, citing an alleged cryptocurrency arrest order related to a criminal case or court decision.

“Sometimes, when the situation doesn’t require genuine signatures and names, Match systems simply fabricates court documents. By the way, many of these documents end up in exchanges like Garantex, Huobi, and Binance, among others,” revealed the informant.

The source mentioned that this is not the first occurrence of exchanges receiving false court orders to freeze client accounts. For example, in early October, the Baza Telegram channel highlighted a situation where a Moscow investigator was under suspicion for fabricating a court decision to freeze an account on the Garantex cryptocurrency exchange. 

As per the inquiry, Senior Police Investigator Antonina Shakina was accused of masterminding a fraudulent scheme targeting Garantex. In late 2022, she, alongside unidentified accomplices, forged a false account freeze order and submitted it to the exchange.

According to the informant, Match Systems employs a similar scheme.

Furthermore, the source claims that the company markets services from other providers as its own among Russian banks and government entities. For instance, the project portrays its product as an independent development during investor meetings, all the while making use of databases like Crystal Blockchain, Chainalysis, and leaked databases from Russian law enforcement agencies.

The informant claims that Match Systems is founded by individuals with a background in Russian law enforcement, asserting that the firm’s law enforcement experience allows it to quickly issue orders to freeze accounts on crypto exchanges.

“Most employees and founders have direct ties to law enforcement agencies in Russia. This is where all the schemes and data originate,” the source claims.