The US Justice Department has quietly ended its investigation into Kraken founder Jesse Powell, returning dozens of devices seized in a 2023 raid.
In a major development for the crypto industry, the US Justice Department has quietly ended its probe into Jesse Powell, returning dozens of laptops, phones, and devices seized during a 2023 raid on his home.
Contrary to initial media reports, the investigation had nothing to do with Powell’s management of Kraken. Instead, it centered on allegations made by board members of Verge Center for the Arts, a Sacramento-based nonprofit Powell founded in 2008.
The dispute highlighted allegations of the unlawful access to Powell’s Slack and Google accounts after he was removed from Verge’s board. Powell has long maintained that he neither hacked nor stalked anyone, claiming Verge executives tried to remove him in secret by changing account credentials and launching a new domain. He sued for defamation last year, and new court filings confirm the DOJ has now closed the criminal side of the case entirely.
“The FBI’s raid on my house was devastating both personally and professionally. It is still shocking that the raid was premised on Verge Center for the Arts baseless accusations against me. I knew that I had done nothing wrong, and discovery in my defamation case against Verge has shown this is undeniable,” said Powell in an email statement to Fortune.
Fallout for Verge Board as Declination Letter Surfaces
The Department of Justice’s decision was made formal in a declination letter issued to Powell’s legal team earlier this month. His attorney, Brandon Fox, said the letter will help repair reputational damage to Powell and to Kraken, as the exchange continues to prepare for a potential public listing in the US.
Court documents allege Verge board members failed to disclose key internal communications during the civil discovery process. One board member, Phil Cunningham, also the nonprofit’s legal counsel, has declined to comment. Separately, Verge continues to operate in Sacramento’s arts scene, after Powell donating over $1 million in personal support.
Neither Powell nor federal authorities disclosed whether any Bitcoin or digital assets were recovered from the returned devices, which had been confiscated when Bitcoin was trading around $23,000. As of today, Bitcoin BTC $118 098 24h volatility: 0.9% Market cap: $2.35 T Vol. 24h: $46.07 B price hovers near $120,000, reflecting the scale of potential asset risk in overreaching government seizures.
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