MtGox CEO tries to shift blame onto Vinnik and Mizuho

Maria Nikolova

In an effort to nix the allegations brought by former MtGox customers, Mark Karpeles says Alexander Vinnik and Mizuho should bear the brunt of responsibility for customer losses.

There are several US lawsuits related to the collapse of notorious bitcoin exchange MtGox that name Mark Karpeles, owner and CEO of the ill-fated company, as a defendant. In one of these lawsuits, Gregory Pearce, a Pennsylvanian customer of MtGox, claims one count of negligence and one count of fraud against Karpeles. Pearce brings these claims on behalf of himself and the “Mt. Gox Class.”

On September 6, 2019, Karpeles filed his answer to the plaintiff’s complaint, trying to shift the blame for the losses suffered by MtGox’s customers to Alexander Vinnik and Mizuho Bank.

Gregory Pearce created an Mt. Gox account in November of 2013, and he provided Mt. Gox with his West Chester, Pennsylvania, address, as well as proof of his identity. As a result of Mt. Gox’s virtual presence, a total of 19,208 addresses associated with Mt. Gox accounts came from Pennsylvania. After creating his account with Mt. Gox, Pearce transferred his previously purchased bitcoins to his Mt. Gox account and began to sell and trade through the Exchange.

In January 2014, Pearce converted some of his bitcoin to fiat currency with the intention of immediately withdrawing $5,900 from his Mt. Gox account. Pearce never received his funds, and, on February 10, 2014, he received a message from Mt. Gox’s customer support indicating that all international withdrawals were delayed. During this same time, Pearce attempted to cancel his fiat currency withdrawal request and move his entire Bitcoin balance out of Mt. Gox, but his attempts to transfer his Bitcoin balance out of the Exchange also failed.

At no point prior to, or during the transfer of his bitcoins into the Mt. Gox Exchange did Mt. Gox notify Pearce that Mt. Gox had suffered any type of computer “bug”; Mizuho was no longer providing withdrawal services to Mt. Gox users; and both bitcoin and fiat currency funds would be permanently inaccessible. Pearce claims that he would not have opened his account with Mt. Gox or transferred his bitcoins into the Exchange, or would have taken immediate steps to withdraw his bitcoins from the Exchange, if he had known that: Mizuho was interfering with Mt. Gox’s ability to service users; his ability to make cash withdrawals from the exchange would be materially compromised; the security of Mt. Gox had been compromised; or Mt. Gox intended to go offline and declare bankruptcy.

Pearce initiated this class action suit against Karpeles and Mizuho in January 2018 but in August 2018, the Court found it did not have personal jurisdiction over Mizuho and dismissed it. In July this year, the Court nixed Karpeles’ motion to dismiss for alleged lack of jurisdiction, so the case against MtGox’s CEO continues.

In his response, filed with the Pennsylvania Eastern District Court on September 6, 2019, Karpeles argues that there is no proof that he stole money from the Exchange. However, he stresses that, in July 2017, the US Federal Prosecutors charged Alexander Vinnik, a Russian citizen, with laundering 530,000 of the stolen MtGox bitcoins through his WME wallets and other accounts.

Further, Karpeles argues that Mizuho Bank bears significant responsibility for the specific damages alleged by the plaintiff. According to Karpeles, Mizuho is an indispensable party to the litigation.

According to Karpeles, Pearce has failed to include “necessary and indispensable parties” and therefore the action has to be dismissed.

Read this next

blockdag

Top Crypto Millionaire Picks: ETH, SOL, BLP

The market is buzzing with the arrival of a new bull run, and savvy investors are closely watching certain cryptocurrencies that show promise for substantial returns.

blockdag

Influencer Examines BlockDAG Advances as Presale Hits $27.7M Amid Updates on Solana Transaction Fees and Injective (INJ) Price

Discover what famous YouTube influencer CryptoDexWorld has to say about BlockDAG’s presale performance and mining capabilities. More on Solana Transaction Fees and Injective (INJ) Price Updates.

blockdag

Discover the Best Altcoins to Buy: Exploring Near Protocol, Cardano, and BlockDAG’s 30,000x Potential

Explore top altcoins like Near Protocol, and Cardano, and discover BlockDAG’s massive potential. Join us!

blockdag

Crypto Influencer Crypto Rick Endorses BlockDAG Amid $27.7M Presale Success; TRON Price & BCH See Surge

Crypto Rick endorses BlockDAG, boosting its $27.7M presale amid TRON and Bitcoin Cash surges. Explore why BlockDAG is a top crypto investment.

blockdag

These Altcoins Have The Potential To Make You a Millionaire in 2024

The crypto market is witnessing a surge, and certain alternate coins are catching attention for their rapid growth.

Digital Assets

Point72 invests $77.5 million in Bitcoin, Morgan Stanley holds $269.9 million

Point72, the $34 billion hedge fund owned by billionaire and New York Mets owner Steven Cohen, held $77.5 million in the Fidelity Wise Origin Bitcoin Fund (FBTC) at the end of the first quarter, according to a recent filing.

Digital Assets

Binance claims Nigerian officials sought $150 million bribe

A Nigerian court has ruled that Tigran Gambaryan, a Binance executive detained on charges of tax evasion and money laundering, can stand trial on behalf of the world’s largest cryptocurrency exchange.

Digital Assets

Kraken reviews Tether listing in Europe ahead of MiCA adoption

Cryptocurrency exchange Kraken is “actively reviewing” whether to delist the stablecoin Tether (USDT) from its European platform, according to a report by Bloomberg.

blockdag

Discover How MoonBag Coin Presale Stacks Up Against Dogecoin & Litecoin

Discover how the MoonBag Coin presale compares to Dogecoin and Litecoin, with unique features, a robust presale structure, and new opportunities in 2024.

<