The former CEO of the now-defunct bitcoin exchange Mt Gox, Mark Karpeles, could face up to decade in prison if prosecutors have their way.
According to the Nikkei Asian Review, prosecutors are seeking a 10-year jail term for Mark Karpeles for embezzlement. Among the claims made by prosecutors at the Tokyo District Court include the fact that Karpeles diverted company funds to other ventures and is also responsible for ‘destroying the confidence of bitcoin users’.
Per the prosecutors, Karpeles embezzled 340 million yen (approximately US$3 million) of client funds which had been deposited in a bank count belonging to the fallen bitcoin exchange. Karpeles is alleged to have transferred the funds in 2013 between September and December. The prosecutors also accuse Karpeles of manipulating the trading system of Mt Gox with a view of padding the balance.
In the course of the trial, Karpelese has insisted that he did not embezzle funds but rather the money transferred was a temporary loan. But according to the prosecutors there was no paperwork to prove Karpeles’ claim:
“There was no documentation of loans and there was no intention of paying back”
At the start of the trial last year in July, Karpeles denied the charges of data manipulation and embezzlement proclaiming ‘I swear to God I am not guilty’ in a statement as CCN reported at the time.
— CCN (@CryptoCoinsNews) July 11, 2017
Then Karpelese argued that the funds he had allegedly embezzled were not client funds but revenue generated by the defunct bitcoin exchange.