2018-7-24 16:25 |
As reported on FinanceFeeds, the criminal case filed against defendants Bitfunder and Jon E. Montroll, accused of operating an unregistered securities exchange and defrauding its users, has led to a plea agreement. As a result, negotiations with the Securities and Exchange Commission (SEC) for the resolution of the civil case have accelerated.
Defendants Show Efforts to Resolve Criminal CaseOn July 18, Bitfunder and Montroll submitted a status report to the New York Southern District Court, showing an intention to resolve the criminal case (United States v. Montroll, 18 Mag. 1372). As a consequence, the parties will enter into a plea agreement, which is expected to be finalized by July 23.
As a plea agreement in the criminal case is incoming, defendants Bitfunder and Montroll are now making negotiations with the SEC in the civil case at a heightened pace. They expect to resolve this civil case also through agreement. The final resolution for this is expected to be reached in two to three months.
How the Case BeganIn February 2018, SEC found irregularities at Bitfunder, a Bitcoin-dominated exchange. The agency charged Bitfunder and its founder, Jon Montroll, with operating an unregistered securities exchange and defrauding users of the said platform. They also charged Bitfunder for making misleading and false statements in relation to their offering of unregistered securities.
The SEC alleged that the exchange was operating outside the legal purview of securities laws, i.e., without registration, and the company went ahead to misappropriate Bitcoin holdings of users of its exchange. It was also alleged that the platform failed to disclose a cyber attack on its system, which led to the theft of more than 6,000 Bitcoins.
On the other hand, Montroll, as SEC alleged, sold unregistered securities that purported to be investments and misappropriated those funds as well. Their activities were found to be in violation of the antifraud and registration provisions of the federal securities laws. SEC seeks permanent injunctions and disgorgement, with penalties and payment of interest, against the defendants.
Meanwhile, Montroll is facing complaints of perjury and obstruction of justice in a separate criminal proceeding.
Bitfunder Fraud Civil Lawsuit Case Proceedings Accelerate was originally found on [blokt] - Blockchain, Bitcoin & Cryptocurrency News.
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