Former CEO of Crypto Exchange Faces ASIC Charges for 147m Bitcoin Fraud

The former CEO of the now-defunct cryptocurrency exchange Mine Digital has been charged by Australia’s securities watchdog for defrauding an investor of $1.47 million. Grant Colthup, who operated under ACCE Australia Pty Ltd, is facing one count of fraud after a customer did not receive the Bitcoin they had paid approximately $1.47 million for in July 2022. Mine Digital operated as a cryptocurrency exchange from May 2019 to September 2022, when it collapsed, leaving creditors with $16 million in claims.

According to the Australian Securities and Investments Commission (ASIC), the customer paid the money to ACCE Australia with the expectation of receiving Bitcoin in return. However, Colthup allegedly used the funds to pay off his company’s debts or invest in other cryptocurrencies. This is not the only allegation faced by Mine Digital, as it was discovered that the firm had major discrepancies in its assets under management, with only $20,000 in assets despite creditors claiming $16 million in losses.

Colthup is being sued by ACCE’s court-appointed liquidator, seeking compensation for the company’s creditors. He has been charged under section 408C of Queensland’s Criminal Code 1899, which carries a maximum penalty of 20 years imprisonment. Colthup is scheduled to appear in court on December 16, 2024.

This is not the only legal action taken by ASIC this year involving cryptocurrency firms and significant investor losses. In April, the regulator initiated civil proceedings against NGS Crypto Pty Ltd, NGS Digital Pty Ltd, and NGS Group Ltd for misleading investors and resulting in losses of over 160 million AUD. ASIC also launched a nationwide crackdown on cryptocurrency scams following criticism from Australia’s minister for financial services for their failure to warn the public about a $1.3 billion crypto scam.

In a year-long operation, ASIC has taken down over 600 crypto scam websites in an effort to protect investors from fraudulent activities in the cryptocurrency space.