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Bitfinex’s parent company iFinex Inc. filed an application to the court to recover $880 million of allegedly inaccessible funds.
Bitfinex, the cryptocurrency exchange which has been enmeshed in a legal tussle for a while now, has filed an application with the US Court in the Central District of Southern California, through its parent company, iFinex Inc. Filed on the 18th of October 2019, Bitfinex wants the Court, through a subpoena, to help recover more than $850 million that has been unreachable by the exchange because of supposed problems being faced by the company’s payment processor Global Trade Solutions AG, otherwise known as Crypto Capital.
According to Bitfinex, Crypto Capital has been in business with the exchange for a few years now, since 2014 but became its major payment processor from around 2017 when Taiwanese banks abandoned the exchange because of external pressure. Bitfinex further reveals that as of December 2018, Crypto Capital was in possession of more than $850 million worth of the exchange’s money but has been unable to access it. This is because Crypto Capital has said that authorities and law enforcement agencies in the U.S., Poland, the U.K. and Portugal, have seized the funds, disallowing any further transactions. Bitfinex has been unable to gather more information so far.
The subpoena requested by Bitfinex is “for the taking of a deposition and production of documents for use in a foreign proceeding” and is directed at the testimony of Rondell “Rhon” Clyde Monroe the Vice President of TCA Investment Bancorp and Trust company. According to the filing, the deposition is needed because Crypto Capital allegedly employed the services of TCA when it needed to transfer funds belonging to Bitfinex. The exchange wants to force Monroe to reveal any information TCA has, as well as documents including communication with a Crypto Capital Exec Ozzie Yosef, to solidify its claim of the relationship between the two firms, ultimately giving more credence to the Bitfinex request for its funds.
Bitfinex further claims that of the more than $850 million, about $306 million through Crypto Capital and TCA Bancorp, is currently with G.T.S. Resources Limited also known as Spiral Global Development Limited, a U.K. company owned by Reginald Fowler who is in the middle of a U.S. Attorney’s Office investigation for alleged fraud. Dennis Fowler, Reginald Fowler’s son, is also involved as he is said to be in control of at least one of the Crypto Capital accounts used. Supposedly, another $218 million is currently in the hands of 3 Portuguese banks with Polish Bank Spoldzielczy holding another $355 million as well. Bitfinex is also asking for information on some of Crypto Capital’s accounts in quite a few American banks including US Bank, Bank of America, HSBC, Sun Trust, Wells Fargo and others.
Back in April, the New York Attorney General’s office accused Bitfinex of illegally using funds from its affiliate, Tether, to cover up an $850 million loss without revealing this to investors. Later, the story had a continuation. Allegedly, Bitfinex accessed this money and used it to shore up its shortfalls when it was unable to cater to its customers, because of the loss.