Former CEO accused of stealing $1.5M in Bitcoin fraud case
The former CEO of Mine Digital, an Australian cryptocurrency exchange, is facing fraud allegations after reportedly misappropriating $1.47 million from a customer.
According to the Australian Securities and Investments Commission (ASIC), the ex-CEO, Grant Colthup, allegedly took the funds in a transaction meant to exchange the sum for Bitcoin (CRYPTO:BTC).
ASIC revealed on October 21 that the victim transferred $1.5 million to ACCE Australia, expecting to receive an equivalent amount in Bitcoin.
However, the cryptocurrency was never delivered.
The regulator claims Colthup used the funds to either cover the company's liabilities, purchase cryptocurrency for others, or a combination of both.
This latest accusation comes as Mine Digital struggles with financial difficulties.
The exchange entered administration in September 2022, leaving creditors attempting to recover approximately $16 million.
The initial investigation found that only $20,000 worth of assets were under ACCE’s control, far short of the creditors’ claims.
ASIC charged Colthup under Queensland’s Criminal Code 1899, Section 408C, which carries a maximum penalty of 20 years in prison.
The case was heard at the Magistrates Court in Ipswich, Queensland, and has been adjourned until December 16, 2024.
The fraud incident took place when Bitcoin prices ranged between $18,890 and $24,580.
With Bitcoin currently trading around $67,460, the misappropriated amount would now be valued at over $4 million.
Mine Digital offered various trading services from May 2019 until its collapse in September 2022.
Colthup was allegedly targeted by PKF, the appointed liquidator, who sought to recover losses on behalf of creditors.
PKF’s Business Recovery and Insolvency Partner, Brad Tonks, was assigned as ACCE’s liquidator, and efforts to reclaim the missing $16 million are ongoing.
At the time of writing, the Bitcoin price was $67,354.05.
Disclaimer: The content of this article solely reflects the author's opinion and does not represent the platform in any capacity. This article is not intended to serve as a reference for making investment decisions.
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