Inforexnews
The owner of BitFunder, a bitcoin-based stock exchange, has been captured by the US government. The charge against Jon Montroll, also known as "Ukyo," was launched today by the US Department of Justice after an investigation involving the Federal Bureau of Investigation (FBI) and the Securities and Exchange Commission (SEC).
The SEC runs civil charges against Montroll in separate acts, arguing that he operates an unlicensed stock exchange and commits fraud against investors. Based on the US Attorney's Office in the Southern District of New York, Montroll was arrested on Wednesday (21/2).
SEC Has Long Been Investigating BitFunder
The details of the case come from earlier periods in the history of bitcoin when websites such as BitFunder similar stock exchanges for cryptocurrency firms are more common. BitFunder closes at the end of 2013, and acts as a companion service for WeExchange cryptocurrency exchanges.
As stated in the Justice Department complaint, BitFunder is the target of hacking efforts that allow those behind the attack to credit their own funds. This resulted in the withdrawal of about 6,000 bitcoins from WeExchange, making the service bankrupt.
Prosecutors allege that, in November 2013, Montroll gave sworn testimony to the SEC Regional Office in New York in connection with their investigation of Exploit and BitFunder activities. As part of the testimony, he delivered a balance statement reflecting the amount of bitcoin available to BitFunder users in Wallet WeExchange starting October 13, 2013, amounting to about 6,700 BTC.
However, the balance sheet statement was misleading, the Justice Department said Wednesday (21/2), accusing: "Contemporary digital evidence, including conversation data and transaction data, reveals that the Trial Balance is a misleading engineering. Three days into the Exploit, Montroll has participated in an internet chat with another person called 'Person-1' where he asked for help to track the stolen coins. "
"However, when the effort was unsuccessful, Montroll transferred some of his own bitcoin holdings to WeExchange to hide the loss. In the Trial Balance, WeExchange actually holds thousands of bitcoins worth less than the False Balance Sheet, "added a statement from the Justice Department.