Ex-CEO of the now defunct Mt. Gox exchange has called for the dismissal of the case against him by a U.S. court, stating that the court has no jurisdiction over him.
Lack of Personal Jurisdiction
Mark Karpelès, the former CEO of the one-time giant Bitcoin exchange platform, Mt. Gox, has refuted claims brought against him by aggrieved former users of the platform. Karpelès called for a dismissal of the case on August 24, disputing the Illinois Northern District Court’s jurisdiction in the matter.
Karpelès (the defendant) stated that as a French citizen residing in Japan, the required “minimum contacts” were not satisfied. He also said that he didn’t undertake any business activities in the state. The complaints against the defendant are not related to his activities on the forum.
The defendant has said that the plaintiffs have not claimed that he conducted any business activity in the forum state. The plaintiffs have, however, legally concluded that Karpelès carried out business transactions through Tibanne KK and Mt. Gox Exchange in the forum state.
Gregory Greene and Anthony Motto brought the action to the court and are holding Mizuho Bank, Ltd. and Mark Karpelès responsible for their financial losses as a result of the exchange’s collapse. The plaintiffs claim that unsuspecting investors were trapped when they used the Mizuho Bank to send money into the platform’s account after June 21, 2013.
There was a suspension in the withdrawals of USD from the exchange on June 21, 2013, which later resumed on July 4th. Customers relied on the platform’s promise to help keep funds and continued trading on the platform. Things went awry when several users requested to withdraw their money from the platform and were unsuccessful. Only a few investors were granted their wish; the majority, however, weren’t as lucky.
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The Travails of Mark Karpelès and Mt. Gox
The ex-CEO has not had a smooth ride since the company’s collapse in 2014. From having a company that was once the largest cryptocurrency exchange by market volume, to facing embezzlement and fraud charges, the past several years have likely been a nightmare Karpelès wishes would end.
The exchange declared bankruptcy in February 2014 after $473 million was stolen from the company. On August 1, the Japanese police arrested the French CEO on the grounds of manipulating and siphoning investors’ funds. In July 2017, Karpelès stood trial for embezzlement at a Tokyo District Court. In an interview with BBC Radio, the CEO stated how his world came crashing down after realizing that his company had been hacked.
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