Federal authorities arrested BitFunder owner Jon Montroll this Wednesday on charges of misleading the Securities and Exchange Commission (SEC) in relation to a cyber attack that led to the theft of 6,000 bitcoins. The SEC has separately charged Montroll with fraud.
Montroll, who hails from Texas, operated WeExchange Australia Pty Ltd., a bitcoin depository and exchange service, along with BitFunder.com, a cryptocurrency stock exchange. In 2013, hackers stole 6,000 bitcoins from WeExchange by exploiting a vulnerability in BitFunder’s programming code. The stolen bitcoins are worth around $70 million today.
Prosecutors said that Montroll had lied to the SEC that the hackers were unsuccessful and also provided false evidence regarding the availability of bitcoins to BitFunder users. Montroll also transferred his own bitcoins into WeExchange to cover up the losses.
Manhattan U.S. Attorney Geoffrey Berman stated that Montroll repeatedly lied in sworn testimony and misled SEC staff to avoid taking any responsibility for the loss of thousands of his customers’ bitcoins.
The stolen bitcoins are worth around $70 million today
The SEC alleged that the now-defunct BitFunder had operated as an unregistered online securities exchange. The agency also said that Montroll had deceived his users by misusing their bitcoins and also withholding information about the hack that involved the theft of over 6,000 bitcoins.
The Department of Justice is charging Montroll with two counts of perjury and one count of obstruction of justice which combined would entail a prison sentence of 30 years.
Most Popular
IPO Alert: What to look for when Boundless Bio goes public
Boundless Bio is preparing to debut on the Nasdaq stock market this week, and become the latest addition to the list of biotech firms that have launched IPOs this year.
Nike (NKE) bets on innovation and partnerships to return to high growth
Sneaker giant Nike, Inc. (NYSE: NKE) has been going through a rough patch for some time, with sales coming under pressure from weak demand and rising competition. Post-pandemic, the company
Walgreens Boots Alliance set to report earnings next week. Here’s what to expect
Walgreens Boots Alliance, Inc. (NASDAQ: WBA), the drug store chain that is expanding into a diversified healthcare provider, is on a restructuring drive aimed at better aligning the business with