The head of a bitcoin escrow company has been charged by U.S. prosecutors with fraud. DOJ claims bitcoin escrow firm swindled investors for 7 Million.
Two counts each of commodity and wire fraud were brought against Jon Barry Thompson, principal of Volatnis Escrow Platform LLC. A division of the Department of Justice, The U.S. Attorney’s Office of the Southern District of New York, brought forth the charges. He is accused of making misleading statements about investment risks. Also, false representations of his custody and control of digital assets, in a complaint unsealed Thursday:
“As his clients soon realized Thompson’s representations were false, and these cryptocurrency investors ultimately lost all of the money they had entrusted with him because of his lies.”
DOJ claims bitcoin escrow firm swindled investors for 7 Million. Prosecutors said it was his clients’ lack of information regarding the emerging asset class, that Thompson “preyed” upon.
Subsequently, he presented himself as a competent investor, custodian, or financier, in promotional materials and communication with clients.
However, n the hopes of receiving bitcoin in exchange, the two companies sent Thompson multi-million-dollar wires, only to be defrauded.
Thompson allegedly told one client, “Cash is with me, the coin is with me.”
Prosecutors claim that after skimming thousands off the top for personal use, and without first obtaining any bitcoin, he sent their $3 million to a third-party exchange.
Volantis negotiated a deal to transfer 6,600 bitcoin to Symphony, a crypto investments firm, but apparently, “The transaction never closed”, according to a Forbes article published in January.
Thompson now faces a maximum sentence of 40 years, as he was arrested in Pennsylvania, last Thursday.