An Australian watchdog has charged former cryptocurrency CEO Grant Colthup with committing fraud.
Colthup was the chief executive of ACCE, which traded as Mine Digital. The crypto exchange platform went into administration in September 2022. The Australian Securities and Investments Commission (ASIC) says he appeared in the Magistrates Court yesterday (Oct. 21).
What is Grant Colthup charged with?
The ASIC alleges that Colthup defrauded one of his clients 2.2 million Australian dollars (approximately 1.47 million USD). According to the regulator, a customer paid that amount to Mine Digital in exchange for Bitcoin in July 2022. The cryptocurrency was never received, however.
It claims that the customer’s money was instead used to “pay liabilities […] and/or purchase cryptocurrency for others”.
That Bitcoin would now have been worth over $4 million as the cryptocurrency is currently trading at about $67,000.
The court was adjourned to December 16. Colthup could face up to 20 years in prison if he is found guilty under section 408C of Queensland’s Criminal Code 1899.
Defunct Mine Digital in hot water again
This is far from the company’s first time in hot water. After Mine Digital went defunct, an investigation found that the company only had $20,000 in assets in October 2022. This was a huge discrepancy from the $16 million that ACCE was claimed to have.
Then in December 2022, the company was appointed a liquidator. He went on to sue Grant Colthup a month later to get compensation for the creditors.
Additionally, the ASIC outlined new plans for crypto firm licensing in September.
“ASIC’s message is that a significant number of crypto-asset firms in the Australian market are likely to need a license under the current law,” ASIC commissioner Alan Kirkland said.
“ASIC believes that licensing and its subsequent protections will mitigate risk while bolstering consumer confidence and market integrity – two elements that are crucial in encouraging innovation in the financial system.”
Featured image credit: Dall-E 3
