Even before being hit with a federal securities fraud lawsuit by the SEC and independent perjury charges by the Justice Department last month, the founder of a now-defunct cryptocurrency exchange had left a trail of lawsuits, legal judgments and a lawyer who says she never got paid by him.Jon Montroll, 37, was accused on Feb. 21 in a civil complaint by the Securities and Exchange Commission of running his cryptocurrency site BitFunder as an “unregistered securities exchange” and of defrauding users.
Montroll also was arrested on separate charges of perjury and obstruction of justice lodged by the U.S. Attorney for the Southern District of New York on Feb. 21.
The prosecutor said Montroll gave false testimony and false documentation during the SEC investigation into BitFunder. The SEC complaint said the Saginaw, Texas, resident failed to disclose a cyberattack on his exchange’s system and a bitcoin theft that followed that hack.
In 2013, hackers were able to withdraw from about 6,000 bitcoins from BitFunder, the SEC said, worth about $775,000 at the time. As of Monday, those bitcoins were worth roughly $68.7 million.
After the theft, Montroll transferred some of his own bitcoin holdings to conceal the losses, according to the DOJ’s complaint. The cases are pending, and Montroll is scheduled to appear in Manhattan federal court on Wednesday in the DOJ case. Read more from cnbc.com…
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