Mt. Gox: Tokyo prosecutors drop embezzlement charges against Mark Karpeles

Embezzlement charges against Mark Karpeles, former CEO of the infamous Bitcoin exchange, Mt. Gox, have been dropped, reported The Mainichi.

Tokyo prosecutors had previously leveled charges of fraud, embezzlement and breach of trust on Karpeles. The prosecutors had asked the court for a ten-year prison sentence, but had to settle for a meager judgment instead.

On 15 March, a Tokyo District court charged Karpeles of falsifying electronic data, but did not find him guilty of embezzlement, much to the fury of the cryptocurrency community. The French businessman was granted a suspended jail sentence of two and a half years by the court, and will not face jail time if he does not commit any crime for four years.

Between the period of September to December 2013, Karpeles was accused of transferring 341 million yen [$3 million] from his customers’ accounts to Mt. Gox accounts. According to alleged reports, the sum was also used to purchase a slew of items like a software developer and a canopy bed worth 6 million yen.

According to the charges, between February and January of the same year, Karpeles also manipulated the exchange’s Bitcoin trade data to show the amount inclusive of his account details.

The charges levied against Karpeles stated that he mixed his personal finance with that of the exchange. In order to conceal the exchange’s losses, the former CEO used his accounts to inflate the exchange’s Bitcoin trade data and was found guilty by the Tokyo District Court.

The Mainichi also reported that the Frenchman’s lawyers were mulling over the prospect of appealing the falsifying data charges, with the hope of getting these charges dropped as well.

Mt. Gox was the world’s largest Bitcoin exchange, handling over 70 percent of all BTC transactions around the globe in January 2014. A hack a month later however, rendered the exchange bankrupt.

Over 740,000 Bitcoins or 7 percent of the global BTCs in supply at the time were affected, with the exchange’s bank accounts seeing a $27 million theft as well.

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