In today’s edition of Bitcoin in Brief we cover a number of stories related to crime from around the cryptosphere: an exchange operator pleads guilty to securities fraud, a scammer is fined over $1.9 million for bitcoin and binary options fraud, police get a crypto course and a new type of ransomware attack is discovered.
Also Read: EU Study: International Nature of Cryptocurrency Markets Is a Challenge for Regulators
Exchange Operator Pleads Guilty
Jon E. Montroll, a 37-year-old from Texas which was arrested by the FBI for trying to cover up massive client losses after his exchange was hacked, pleaded guilty to one count of securities fraud and one count of obstruction of justice on Monday. Each charge carries a maximum penalty of 20 years in prison. Montroll operated two bitcoin services, Weexchange which functioned as a bitcoin depository and currency exchange service, and Bitfunder which facilitated the purchase and trading of shares of businesses that listed on the platform. During the summer of 2013, hackers stole approximately 6,000 bitcoins from Weexchange, and, as a result, the two ventures lacked the bitcoin necessary to cover what was owed to users, which he tried to hide.
Manhattan U.S. Attorney Geoffrey S. Berman said: “Montroll deceived his investors and then attempted to deceive the SEC. He repeatedly lied during sworn testimony and misled SEC staff to avoid taking responsibility for the loss of thousands of his customers’ bitcoins.”
Scammer Fined Over $1.9 Million
A federal court has ordered Dillon Michael Dean of Colorado, and his UK-registered company The Entrepreneurs Headquarters Limited (TEH), to pay over $1.9 million in civil monetary penalties and restitution. A judge found that Dean engaged in a fraudulent scheme to solicit bitcoin from the public, lied that customers’
