Bitfinex parent company submits a search application to the US court, intending to recover the frozen 880 million US dollars

Key points:

  • On October 18, 2019, Bitfinex's parent company, iFinex Inc., filed a search for a Discovery application from the Central District Court of Southern California.
  • Bitfinex said the company's application was designed to recover $880 million from Bitfinex's entrustment to Global Trade Solutions AG (also known as Crypto Capital).
  • Bitfinex has been unable to use the $880 million funded by Crypto Capital since December 2018, as the payment processing company claims that its bank accounts in Poland, Portugal, the United Kingdom and the United States have been seized or frozen by government agencies.

On October 18, 2019, Bitfinex's parent company, iFinex Inc., filed a search for a Discovery application from the US District Court for the Southern District of Southern California, which included $880 million in funds that were temporarily unavailable. Currency exchanges are related to the payment processing relationship between Crypto Capital and other entities.

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Bitfinex asked to call Rondell "Rhon" Clyde Monroe and asked Monroe, vice president of TCA Investment Bank and Trust Company (TCA Bancorp), to produce the documents. iFinex is registered in the British Virgin Islands and its application is filed under Section 28, Section 1782 (a) of the United States Code. This is a federal law that allows US courts to use a search tool to assist non-US litigation. Therefore, if the application is approved, it will allow for the identification and submission of documents in the foreign cases described therein. Bitfinex Chief Financial Officer Giancarlo Devasini submitted a support statement at the same time as the application was submitted.

Bitfinex said the search application was in order to recover the $880 million in funds that Bitfinex entrusted to Global Trade Solutions AG (also known as Crypto Capital). Bitfinex claims that Crypto Capital has been providing payment processor services to cryptocurrency exchanges since 2014, but mainly between 2017 and 2018, when Bitfinex was under pressure from US banks to sever business relationships with Taiwanese banks.

Bitfinex further claims that at least from December 2018, the company will not be able to use the $880 million in funds hosted by Crypto Capital, as the payment processor claims that its bank accounts in Poland, Portugal, the United Kingdom and the United States have been used by government agencies. Sealed or frozen. Bitfinex has or plans to file legal proceedings in all of these countries in an attempt to recover these funds.

Bitfinex also believes that Crypto Capital uses one or more accounts of TCA Bancorp to facilitate the transfer of funds on the exchange. Bitfinex said Monroe's information and documentation will help prove the relationship and prove that Bitfinex's claim for the $880 million is true.

According to Bitfinex, Monroe and TCA Bancorp hold Bitfinex $306 million through the British entity GTS Resources Limited (aka Spiral Global Development Limited), which is wholly owned by Reginald Fowler. Bitfinex said that it was not until December 2018 that it knew the relationship between Crypto Capital and Fowler. Fowler is currently undergoing fraud investigations by the US Attorney's Office. Crypto Capital also alleged that Bitfinex's $350 million in funds was deposited in Poland's Spoldzielczy bank account, and another $218 million was deposited in three banks in Portugal. The total amount of these three payments is 880 million US dollars.

In addition, Bitfinex requested Crypto Capital to provide ownership and account usage for Bank of America, including HSBC, Citibank, Bank of America, Sun Trust (Sun). Trust), TD Bank, US Bank, Wells Fargo, etc. This information is intended to help Bitfinex establish relationships with funds held in entities such as Poland, Portugal and the United Kingdom.