Crypto.com accidentally donated $7.2 million. This is a lesson for every leader

Cryptocurrency titan Crypto.com is waging a lengthy legal battle against an Australian woman — and some of her relatives — over approximately $7.2 million the company accidentally deposited into her account over one year. In what looks more like a movie plot than an actual event, Crypto.com is battling – months after the fact – to recover funds that have now been split among multiple people in different countries.

To say that Crypto.com is a victim of its own mistakes would be an understatement: rarely has a company, regardless of size, shot itself in the foot with such perfect aim. There are several lessons here for every business leader. Here are some of the Crypto.com errors.

1. Someone made a typo that started it all.

In May 2021, Crypto.com owed a refund of 100 Australian dollars (AUD), or approximately $68, to a woman named Thevamanogari Manivel. According to news reports, a Crypto.com employee inadvertently entered an account number into a field that was supposed to contain the refund amount. As a result, Crypto.com deposited nearly A$10.5 million, or approximately $7.2 million, into Manivel's account.

Believe it or not, of all the mistakes that have been made in this strange story, this is the smallest and easiest to understand. People get distracted, especially if they're doing repetitive work. Typos happen.

2. No one noticed for seven months.

The biggest problem is that it took until December 2021 for Crypto.com to discover, during a routine audit, that something was wrong. If $7.2 million mysteriously disappeared from your company's coffers, would it take you seven months to find out?

Crypto.com hasn't explained how it didn't notice the missing millions, or made any public statement about it, beyond its court records. (A company representative told Inc. that the company could not comment on the lawsuit while it was pending.) Whatever the reason, it seems clear that someone was not paying attention while 'he should have been.

These seven months gave Manivel plenty of time to decide she wanted to keep the money and figure out how to do it. According to the judgment last week, she transferred AUD 430,000 into her daughter's account and bought a house for AUD 1.35 million in a suburb of Melbourne. She then transferred ownership of this house to her sister who lives in Malaysia. Australian courts ordered Manivel's bank accounts to be frozen. They ordered the sister to sell the house and pay interest and fees. But given the multiple jurisdictions involved and the difficulty so far in serving legal notice on the sister, it's unclear how this will all pan out.

3. Crypto.com is laying off employees. He refuses to say how much.

We don't know why someone didn't monitor Crypto.com accounts. But one of the reasons may be that the person in question recently lost their job or was busy trying to find out how many colleagues had lost theirs.

In June, co-founder and CEO Kris Marszalek said the company was laying off 260 people, or 5% of its workforce, in a series of tweets that were oddly boastful, given what he was announcing.

There may have been more to it. A few months later, The Verge reported that, in fact, Crypto.com had laid off over 260 employees. Nobody knows how much because the company doesn't tell anyone, not even the people who still work there. During an internal town hall this month, someone asked Marszalek how many employees had been laid off, according to The Verge. He said he didn't have to...