Former Mine Digital CEO Charged with Fraud Over Missing Bitcoin Funds

Grant Colthup, the former CEO of Australian cryptocurrency exchange Mine Digital, has been charged with fraud after allegedly misappropriating a customer’s $1.47 million (2.2 million Australian dollars).

The Australian Securities and Investments Commission (ASIC) confirmed yesterday that the customer transferred the funds to Mine Digital’s parent company, ACCE Australia, intending to exchange them for Bitcoin. However, the customer never received the cryptocurrency.

ASIC alleges that Colthup used the funds to pay off ACCE’s liabilities, purchase cryptocurrency for other clients, or combine both. This is the latest legal issue for Mine Digital, which collapsed in September 2022, leaving creditors attempting to recover approximately $16 million.

Following an ASIC investigation, the ex-CEO of crypto exchange Mine Digital has been charged with fraud in connection with a $2.2 million transaction https://t.co/tHrFgaHiSD
— ASIC Media (@asicmedia) October 21, 2024

Legal Proceedings Begin in Queensland

Colthup was informed of the fraud charge during a hearing at the Magistrates Court in Ipswich, Queensland, Australia, yesterday. However, the case was adjourned to December 16. Colthup is charged under section 408C of Queensland’s Criminal Code 1899, which carries a potential maximum prison sentence of 20 years.

According to ASIC, the incident occurred when Bitcoin prices ranged between $18,890 and $24,580, based on data from CoinGecko. Given Bitcoin’s current price of approximately $67,460, the stolen funds would now be valued between $4 million and $5.24 million.

Mine Digital Collapse and Financial Shortfall

Mine Digital, which began operations in May 2019, offered various cryptocurrency trading services until its closure in September 2022. When the company entered administration, an initial investigation revealed that ACCE Australia held only $20,000 in assets, far less than the $16 million creditors claimed.

In December 2022, PKF’s business recovery and insolvency partner, Brad Tonks, was appointed as ACCE’s liquidator. By January 2023, PKF was reportedly exploring legal action against Colthup, seeking a court order to compel him to compensate the creditors. The Australian Financial Review reported that PKF was focused on recovering the funds owed to the creditors left out of pocket after the company’s collapse.

ASIC’s investigation into the missing funds remains ongoing while creditors continue to try to reclaim lost assets from Mine Digital and its parent company, ACCE Australia.

Lawrence does not hold any crypto asset. This article is provided for informational purposes only and should not be construed as financial advice. The Shib Magazine and The Shib Daily are the official media and publications of the Shiba Inu cryptocurrency project. Readers are encouraged to conduct their own research and consult with a qualified financial adviser before making any investment decisions.

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