The Crypto Capital Scandal

Apr 25

Alleged 'Shadow Banker' Reggie Fowler Pleads Guilty to Fraud in Crypto Capital Case

Reginald Fowler, a former minority owner of the Minnesota Vikings, has pleaded guilty to fraud over his involvement in opening and operating bank accounts for cryptocurrency companies. While working for the Panama-based Crypto Capital, Fowler allegedly helped exchanges get banking services when few financial institutions would take them on as customers. But by doing so, he also enabled them to bypass money-laundering regulations, according to the charges. Founded in 2013, Crypto Capital wasn't...

Aug 6

Ex-NFL Owner With Tether Ties Faces Trial in February 2022

Reginald “Reggie” Fowler will appear in court in mid-February next year, according to court documents filed on Wednesday. In 2019, Fowler was accused of bank fraud and running an unlicensed money transmitting business. He allegedly had access to over $300 million stashed around the world. Specifically, it is alleged that Fowler (and fugitive Ravid Yosef) held about $345 million across 60 bank accounts, some of which were opened under the name Global Trading Solutions LLC. Global Trading Soluti...

Jul 9

Tether is a US dollar-pegged stablecoin. Image: Shutterstock

Court denies Bitfinex’s request to scrap $850M fraud investigation

A New York court today denied a request from crypto exchange Bitfinex to scupper an investigation by the state’s Attorney General, who alleges that Bitfinex used its sister company, the stablecoin giant Tether, to hide a near-$1 billion hole in its finances. Despite Bitfinex’s protestations, the court said that it does have jurisdiction, as does the NYAG. Stuart Hoegner, Bitfinex's General Counsel, said in a statement: "We have read the decision issued today by the Appellate Division of the New...

Feb 22

Crypto Capital-connected Fowler hit with new fraud charges

The man who’s thought to have run the company that processed payments for dubious crypto exchanges was on Friday charged with wire fraud, adding to current charges of fraud and money laundering. The indictment, filed Friday by a New York district court, alleged that Reginald Fowler earned his money on “false and fraudulent pretenses.” On the books, Fowler is the CEO of a company called Global Tradings Solutions LLC, which is one of several suspected shell companies associated with Crypto Capit...

Oct 25

Crypto Capital founder allegedly indicted on three criminal counts, after company's president's arrest

The founder of Crypto Capital has allegedly been indicted on three criminal counts by the US Attorney for the Southern District of New York, according to crypto exchange Bitfinex’s general counsel. This follows news that Crypto Capital’s President Ivan Manuel Molina Lee was arrested in Poland yesterday. Stuart Hoegner, General Counsel to Bitfinex said, in a statement, “Oz Yosef (also known as Oz Joseph), another principal of Crypto Capital, has been indicted on three criminal counts by the U.S....

Authorities are catching up to crypto criminals. Image: Unsplash

Crypto Capital president with links to Bitfinex arrested for money laundering, drug running

The president of Crypto Capital, the alleged "shadow bank" at the center of a fraud investigation against crypto exchange Bitfinex and stablecoin issuer Tether, has been arrested by Polish authorities. According to Polish news sites, Ivan Manuel Molina Lee was nabbed in Greece and flown back to Poland Thursday. Authorities have charged Lee with being part of an international drug cartel and running a money-laundering operation that siphoned funds between Latin America and Europe. The National...

Oct 21

Bitfinex files subpoena application to recover Crypto Capital funds

Hong Kong-based Bitfinex, which is already locked in a court case with the New York Attorney General, has filed a subpoena application for discovery and production of documents in a Central California District Court. The application, filed on October 18, aims to help Bitfinex recover $880 million that it claims Crypto Capital, its payment processor, owes the cryptocurrency exchange. The application asks for deposition of Rondell “Rhon” Clyde Monroe, former vice president of TCA Investment Bancor...

Oct 12

Is Brazil's most ambitious crypto company on the ropes?

There are not many big cryptocurrency companies in Brazil. Most of them are exchanges: Mercado Bitcoin, Foxbit, BitcoinTrade, BitCambio and GBB's exchanges (NegocieCoins and TemBTC). With some $100 million under management, and though not an exchange per se, Atlas Quantum is the most ambitious of the crypto finance companies. Atlas claims to arbitrage bitcoin and Tether at overseas exchanges in order to deliver its results at a whopping 3-7% a month (~60% a year). I am not aware of any other com...

May 9

Bitfinex IEO token LEO shares its name with Crypto Capital shell company

Is it just us, or is it a little weird that Bitfinex’s new exchange token, called the LEO—meant to raise $1 billion in an IEO to replace funds “lost” to Crypto Capital—bears the same name as a Crypto Capital-linked shell company? Chalk it up to a wacky coincidence, but them’s the facts. Bitfinex, one of the world’s leading cryptocurrency exchanges, is currently embroiled in a fraud investigation launched by the New York State Attorney General resulting from the loss of $850 million to Panama-bas...

May 3

Crypto Capital accounts were seized in Backpage sex-trafficking bust

Did a sex-trafficking site spark the whole investigation into Crypto Capital, the mysterious Panamanian payment processor at the center of the Bitfinex scandal? For more than a week, the denizens of cryptoland have been captivated by the Panama-based “bank” and the case of the missing $850 million. As it turns out, however, Crypto Capital has a long and sordid history within the cryptocurrency industry, with ties to some of the biggest players in the game. But beyond names like Binance and Krake...

May 2

The strange case against Crypto Capital-connected Reginald Fowler

According to the feds: He has access to $345 million dollars. His money is stashed in dozens of banks all over the world. He was printing up sheets of counterfeit $100 notes. He has links to a vast global conspiracy involving cryptocurrency firms Tether and Bitfinex. And the U.S. Government says he’s a flight risk. Does that sound like Reginald Fowler, an investor in the Minnesota Vikings and U.S. football entrepreneur? Indeed it is, say the feds. And a boffo Sports Illustrated report would seem...

Bitfinex took a loan from Tether, its sister company. Image: Shutterstock

The story of Crypto Capital’s dark past and its deep ties with the crypto industry

Crypto Capital is slowly emerging as the central bank of the crypto industry. It facilitated banking services from one end of the industry—major crypto businesses and exchanges including Binance, Kraken and BitMEX—to the other, including the now-defunct QuadrigaCX and a number of smaller companies implicated in money-laundering schemes and fraud. And according to the the New York Attorney General, it still serves crypto exchange Bitfinex, where by the end of 2018, it was managing more than $1 bi...

Apr 30

Tether “fraud” is just the tip of the iceberg, says crypto intelligence firm CipherTrace

New York regulators rocked cryptoland last week with the sudden yet unsurprising allegation that one of the world's leading cryptocurrency exchanges, BitFinex, had defrauded investors. The exchange—which has staunchly denied the charges contained in the New York Attorney General’s lawsuit—allegedly used its own "dollar-backed" stablecoin, Tether, to sweep $850 million in missing funds under the rug. It's about as scandalous as it gets in crypto. And yet, the blowback could have far more wide-rea...

Rumor: Bitfinex mulls token fundraise

From the Chutzpah Department: Cryptocurrency exchange BitFinex is supposedly planning to raise $1 billion worth of the cryptocurrency Tether in a so-called initial exchange offering. That rumor comes courtesy of Dovey Wan, a crypto entrepreneur who was also the first to break the hack of Bithumb last month. Wan said she had learned of the news from “[Bitfinex] equity shareholders.” Another source, the trader Zhao Dong, appeared to confirm it. If true, it’s...bizarre. The New York Attorney Gene...

Apr 26

A look at Crypto Capital, the company serving both Bitfinex and QuadrigaCX

What does QuadrigaCX, the Canadian exchange that recently lost $190 million in users’ funds and Bitfinex, which lost $850 million in funds, have in common? They both relied on a shady Panama “bank,” Crypto Capital, to handle payment processing. In Bitfinex’s case, the move was a disaster. Yesterday the New York Attorney General accused iFinex—the company which owns Bitfinex and stablecoin Tether—with defrauding investors. The suit claims that iFinex used Tether’s reserves to replace $850 million...

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