ASIC charges Grant Colthup with fraud after a customer paid $1.47 million in Bitcoin but received nothing in return.
The Australian Securities and Investments Commission (ASIC) has charged Grant Colthup with one count of fraud. This charge follows a complaint from a customer of Mine Digital who paid 2.2 million Australian dollars (approximately $1.47 million) in July 2022. However, the customer did not receive the Bitcoin they were promised in return.
Mine Digital was a cryptocurrency exchange company called ACCE Australia Pty Ltd. It provided trading services from May 2019 until shut down in September 2022. After the failure, creditors have been trying to get their $16 million claims.
ASIC Charges Colthup for Misleading Bitcoin Fund Use in Mine Digital Case
ASIC complains that Colthup, affiliated with Mine Digital, misrepresented the use of the funds. The customer was supposed to receive Bitcoin for the payment made to ACCE Australia. However, the regulator has stated that Colthup used the funds to discharge company obligations or purchase cryptocurrencies.
This is not the only legal issue that Colthup or the company will face. After the closure of Mine Digital, the Australian Financial Review conducted an analysis that showed wide inconsistencies. The firm’s declared assets were as low as $20,000, while the creditors lost $16 million.
Apart from fraud charges, ACCE’s liquidator sued Colthup in January 2023. The liquidator sought to pay back the company’s creditors. ASIC charged Colthup under section 408C of Queensland’s Criminal Code 1899. He was arrested and charged with first-degree murder, and if he is found guilty, he will be jailed for up to 20 years. For this case, Colthup has a court date set for December 16, 2024.
Particularly, this case is part of a wide crackdown by ASIC on the industry. In addition, the regulator sued the three firms in civil court in April 2024 for the following names: NGS Crypto Pty Ltd, NGS Digital Pty Ltd, and NGS Group Ltd. The companies are accused of deceiving 450 investors who lost over 160 million AUD.
Moreover, ASIC is also confronting a range of crypto scams more generally. In January 2024, Australia’s financial services minister accused the regulator of failing to alert the public about a $1.3 billion crypto fraud in Australia. In response to these concerns, ASIC embarked on a nationwide clampdown exercise to deal with the issues.
Lastly, ASIC continues to focus on protecting investors in the volatile cryptocurrency market as the legal actions unfold.
