CRYPTOCRIME: 10-YEAR JAIL TERM FORMER MT GOX CEO?

The Japanese prosecutor’s office indicted Mark KARPELES, the former CEO of the now bankrupt crypto exchange Mt GOX and demands a 10-year prison term. He is said to have embezzled $3 million in customer money and thus financed an elaborate lifestyle, among other things. Mt GOX was one of the pioneers in the area of crypto exchanges and had to close down in 2014 after an alleged hacker attack at Bitcoins worth more than 420 million. Only a few months ago, damaged investors in the USA filed a lawsuit against Mark KARPELES. The indictment is not linked to exchange’s loss of $400 million worth of bitcoin which is a separate case.

The indictment filed with the Tokyo District Court claims that Mark Karpeles, 33, “diverted company funds to such uses as investing in a software development business for personal interest” and “played a great role in totally destroying the confidence of bitcoin users.”  The French citizen KARPELES pleaded not guilty in the first hearing of his trial in July 2017, saying, “I swear to God I am not guilty,” in reading out a prepared statement in Japanese. According to a report from The Mainichi on Wednesday, prosecutors claimed at the Tokyo District Court that Karpeles used customers’ funds for his own personal use.

In February 2014, MtGox closed down all transactions, causing a panic among its customers around the world. It then announced that it had gone bankrupt after having lost about 850,000 bitcoins, worth more than USD 400 million back then. MtGox claimed that the bitcoins were stolen in a hacker attack.

The case of Mt GOX and KARPELES demonstrates that the authorities need years to deal with Cybercrime or Cryptocrime cases. The bankruptcy of Mt GOX took place in April 2014 already. So far neither the bankruptcy has been completed nor a final judgment has been issued against Mark KARPELES.