Mt. Gox former CEO wants remaining fraud charge thrown out

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Mark Karpeles, long at the center of the failure of the Mt. Gox digital currency exchange, has repeatedly thwarted efforts to hold him accountable for the exchange’s failure and the massive asset losses that came with it. Several lawsuits have been filed against him in different countries, and many of those who once sent their money to the exchange are still waiting to receive compensation. In his latest effort to deny responsibility for the collapse of the business and the loss of millions of dollars in held funds, Karpeles is making a last-ditch effort to have the remaining fraud charge against him thrown out of court. 

In a lawsuit that dates back to 2014, former Mt. Gox client Gregory Greene has been determined to ensure Karpeles is forced to answer for his involvement in the exchange’s failure, and is the only plaintiff remaining in a lawsuit against the former CEO. He accuses Karpeles of negligence and fraud in his suit, but two of the charges have already been dismissed. This leaves the single count of fraud, which Karpeles now argues is based on misrepresentation on the part of Greene.  As a result, he has asked a judge to bring the debacle to an end. 

This isn’t the first time Karpeles has tried to have the case tossed. Appearing before a judge last August, he argued that, as a French citizen, he was not bound by U.S. laws and could not be tried in the U.S. jurisdiction. That argument fell flat, and his request was denied. This past January, he continued to snub his nose at the U.S. courts, refusing to turn over documents related to the exchange as ordered by the courts. Karpeles has continuously maintained his innocence, asserting that the loss of the digital assets was a result of a hack of the exchange, but his refusal to cooperate paints a different picture.

In going after Greene’s fraud charge, Karpeles asserts that the lawsuit claims to be based on terms of use that weren’t in place when Greene was a customer and, therefore, the suit doesn’t have merit. The judge presiding over the case has not yet responded to the request. 

Karpeles was previously found guilty in a Japanese court of tampering with company documents. He was given a four-year suspended sentence, but the courts decided that there wasn’t enough evidence to convict him of embezzlement. Given that 850,000 BTC went missing in 2014 (worth over $425 million at the time and 40 times as much within three years) and much has yet to be recovered, Karpeles could still be sitting on a gold mine if he did, in fact, cheat exchange users out of their funds.