The former CEO of Mine Digital, an Australian cryptocurrency exchange, is currently facing charges of fraud for allegedly swindling $1.47 million (2.2 million Australian dollars) from a customer who wanted to exchange the funds for Bitcoin. The Australian Securities and Investments Commission (ASIC) released a statement on October 21, revealing that the customer had paid $1.5 million to ACCE Australia but never received the promised cryptocurrency in return. ASIC claims that Grant Colthup, the former CEO, either used the funds to settle ACCE’s debts, bought cryptocurrency for others, or a combination of both.
This is just the latest in a series of accusations against Mine Digital, which went bankrupt in September 2022. Creditors have been attempting to recover $16 million from the company ever since. The country’s securities regulator informed Grant Colthup of the fraud charge during a hearing at the Magistrates Court in Ipswich, Queensland on October 21. The case against him has been adjourned until December 16, 2024.
Colthup has been charged under section 408C of Queensland’s Criminal Code 1899, which carries a maximum prison sentence of 20 years. At the time of the alleged fraudulent transaction, Bitcoin was fluctuating between $18,890 and $24,580, according to CoinGecko data. With Bitcoin currently trading at around $67,460, the Bitcoin that was stolen would now be worth anywhere between $4 million and $5.24 million.
Mine Digital operated as a cryptocurrency exchange platform and provided various trading services from May 2019 until its collapse in September 2022. An initial investigation revealed that ACCE only had $20,000 worth of assets under its control, significantly less than the $16 million claimed by creditors, as reported by the Australian Financial Review (AFR) on October 13, 2022. Brad Tonks, the Business Recovery and Insolvency Partner at PKF, was appointed as ACCE’s liquidator just over two months after the cryptocurrency platform went bankrupt on December 1, 2022.
However, PKF reportedly planned to sue Grant Colthup in January 2023, seeking a court order to compel him to compensate the creditors who were left chasing $16 million, as reported by the AFR.