U.K. company has reportedly been linked to the laundering of stolen bitcoins from the now-defunct crypto exchange Mt Gox.
In a BBC Radio 4 investigation, the company in question is London-based Always Efficient LLP. According to the BBC, it’s not known who is in control of the firm while its registered address in east London is shared by a number of other businesses.[1]
However, it reportedly operated BTC-e, a cryptocurrency trading platform and exchange, which was seized by the U.S. Justice Department last July. At the time, Russian national Alexander Vinnik and BTC-e were charged in a 21-count indictment for operating an alleged international money laundering scheme and allegedly laundering funds from the hack of Mt Gox.[2]
Launched in 2010, Tokyo-based Mt Gox grew to such proportions that by 2013 and into 2014 it was handling around 70 percent of all bitcoin transactions worldwide. In February 2014 the exchange suspended trading, after the exchange’s CEO, Mark Karpelès, discovered the loss of 850,000 bitcoins, eventually filing for bankruptcy protection from creditors. In April of that year, the company started its liquidation proceedings. However, while the exchange was able to recover 200,000 bitcoins in March, the whereabouts of the lost 650,000 coins has remained a mystery.
Speaking to BBC Radio 4’s File on Four programme, Karpelès said that he felt he was ‘about to die’ when the exchange collapsed and customers were unable to withdraw funds.
“Mt Gox went from interesting project to being, I would say, a daily nightmare of dealing with banks, governments, people I never knew existed,” he added.
Investigations, however, have pinpointed some of the stolen coins to BTC-e, which has reportedly assisted the laundering of funds from hacks.
According to Duncan Hames from Transparency International, a global civil society organisation fighting corruption, it’s possible that the exchange was simply acting as a shell company.
“People laundering money will set up a network of companies to create layers between the original crime and their attempts to then integrate the proceeds of their crime into the economy,” he said. “They simply enable a series of transactions to take place to create this distance and to obscure the trail of the proceeds of crime.”
Karpelès was arrested in 2015, charged with fraud and embezzlement related to payments worth $2.3 million. He was also charged with the manipulation of data; however, this was unrelated to the missing 650,000 bitcoins. Apologising for the loss of the coins, Karpelès said that he was working with investigators to recover the missing funds.
Under Japanese bankruptcy law, the 200,000 Mt Gox bitcoins are valued at $483, roughly the price they were valued on the exchange when it ceased operating. Since then, however, the price of bitcoin has skyrocketed and is currently trading at just shy of $10,600, according to CoinMarketCap.
Notably, though, investors are pushing for the coins to be refunded at its
