BitMEX Chiefs Looted More Than $440M From Exchange After Finding Out About Probes, Suit Alleges

• The suit, filed on behalf of plaintiffs BMA LLC, Yaroslav Kolchin and Vitaly Dubinin, seeks an order of attachment against HDR assets, while claims against HDR are being litigated.
• “While being keenly aware of the Commodity Futures Trading Commission (“CFTC”) and Department of Justice (“DOJ”) investigations and imminently forthcoming civil and criminal charges, and while preparing to go on a lam from the U.S. authorities, Defendants Hayes, Delo and Reed looted about $440,308,400 of proceeds of various nefarious activities that took place on the BitMEX platform from Defendant HDR accounts,” the suit alleges.
• The suit claims the alleged looting occured to reduce the amount of assets that could be seized by authorities when charges were brought.
• An attached exhibit did not specify how the funds were seized, but alleged that the executives began diverting BitMEX’s profits after becoming aware of possible charges in 2019.
• On Oct. 1, U.S. Commodities Futures Trading Commission (CFTC) and the Department of Justice both announced charges against BitMEX, one of the biggest crypto derivatives trading platforms, and its senior executives.
• Officials from BitMEX were not immediately available for comment.
• At the time of the original charges, an external spokesperson for HDR denied the allegations, saying “We strongly disagree with the U.S. government’s heavy-handed decision to bring these charges, and intend to defend the allegations vigorously,” the statement said. “From our early days as a start-up, we have always sought to comply with applicable U.S. laws, as those laws were understood at the time and based on available guidance.”

UPDATE: 21:55 UTC. Adds HDR’s denial of the initial charges.
Read also: BitMEX Exchange Hires First Compliance Chief After US Charges