- Cryptocurrency escrow manager, Jon Thompson, pleads guilty to fraud charges
- He scammed companies of $7 million via his escrow business
- He will be sentenced by next year
A publication on Friday by the Justice Department has informed that the operator of two Bitcoin escrow companies, Jon Thompson, pleaded guilty for his involvement in a fraudulent scheme, which resulted in the loss of millions of dollars. Thompson is likely to face a maximum of a ten-year jail term.
Bitcoin escrow operator defaulted company rules
Following the document from the DOJ, Thompson operated the two digital currency escrow firms – Volantis Market Marking and Volantis Escrow Platform – under a collective name ‘Volatis.’ In the past two years, he induced an unnamed organization into transferring millions of dollars to his escrow firms in order for them to purchase cryptocurrency. However, it defaulted as a Bitcoin escrow.
He convinced the unnamed company into believing that he wouldn’t release their money to the digital currency seller except he confirms that those Bitcoins have been sent to him (Thompson). On that note, the company transferred about $3.25 million to Thompson for the cryptocurrency purchase. However, the supposed escrow company manager sent out the funds to another unnamed third party, despite him not receiving Bitcoin.
This went in contrast to Thompson’s advertising contents which noted that the Bitcoin escrow companies would act as assets custodian, facilitating trades for the two sides of a transaction to avoid risks. Even after releasing those funds, Thompson concealed the development from the company for days.In July last year, the escrow manager was arrested on a community fraud charge. As Cryptopolitan reported, he defrauded another company of about $4 million. In total, he scammed companies of $7 million through his cryptocurrency escrow business. Having pleaded guilty today, he is likely to face 10-years imprisonment, as the document suggests. He will be sentenced by next year, precisely on January 7.