Federal authorities charge an executive for alleged $7M bitcoin fraud

The U.S. Attorney’s Office of the Southern District of New York has charged Jon Barry Thompson, principal of cryptocurrency escrow firm Volatnis Escrow Platform, for an alleged bitcoin fraud of over $7 million.

Thompson, 48, is accused of taking money from two unidentified victim companies, falsely assuring that he had purchased bitcoins for them, according to a statement from the Office on Thursday.  He claimed Volantis acted as a custodian of assets and “there is no risk of default.”

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“As his clients soon realized, however, Thompson’s representations were false, and these cryptocurrency investors ultimately lost all of the money they had entrusted with him because of his lies,” said Manhattan U.S. Attorney Geoffrey S. Berman.

Thompson has been charged with two counts each of commodity and wire fraud and was arrested Thursday in Pennsylvania. He faces a maximum sentence of 30 years if proven guilty.