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Jennifer Robertson, widow of deceased QuadrigaCX founder Gerald Cotten, has disclosed that she will be turning over the “vast majority” of her assets to the Quadriga estate so they may be used to partially compensate users who lost funds when Quadriga collapsed.
In a letter dated October 7, 2019, Robertson states:
“Since the initiation of the CCAA proceeding, and as outlined in the Monitor/Trustee’s reports, I have been responsive, helpful and cooperative with the Monitor/Trustee in the search for and recovery of cryptocurrency and other QCX assets.”
“In April, I voluntarily committed to preserving the assets of my late husband’s estate and my own personal assets to ensure future protection for the Affected Users should that be required.”
“I have now entered into a voluntary settlement agreement where the vast majority of my assets and all of the Estate’s assets are being returned to QCX to benefit the Affected Users. These assets originally came from QCX at the direction of Gerry.”
Gerald (Gerry) Cotten died suddenly in India last December from complications of Crohn’s disease.
Cotton’s death caused calamity at QuadrigaCX, but the exchange’s remaining staff did not disclose Cotten’s death for a month, and continued to allow user to trade for an addition 5 weeks.
This despite the fact that it would have been shortly apparent that Cotten had died without giving anyone else password access to roughly $250 million CAD of users’ cryptocurrencies that he was ostensibly keeping in a “cold storage” device (an offline device similar to a thumb drive).
The “Fifth Report of the Monitor” produced by court-appointed auditors in June of this year and submitted as part of Quadriga’s bid for credit relief alleged widespread operational malfeasance at Quadriga.
Not only did Cotten appear to have been running Vancouver-based Quadriga CX virtually alone from a laptop at his home in Nova Scotia, but internal controls were largely absent.
Funds of some of the exchange’s 76 000 customers were also allegedly commingled with exchange funds and gambled, and auditors believe created fake user accounts and traded from them to produce “inflated revenue figures.”
He also appears to have transferred exchange funds to his personal accounts.
In her October 7th statement, Robertson says she was unaware of how Cotten was running Quadriga:
“As I have indicated throughout this proceeding, I had no direct knowledge of how Gerry operated the business prior to his death, and was not aware of his improper actions in managing the QuadrigaCX business as outlined by the Monitor in it 5th report in June. Specifically, I was not aware of nor participated in Gerry’s trading activities, nor his appropriation of the Affected User’s funds.”
It is based on information revealed in the 5th report that Robertson has agreed to forfeit what may be considered ill-gotten gains:
“As a result of the Monitor’s investigation, I have agreed to return to QCX assets that I had previously thought were purchased with Gerry’s legitimately earned profits, salary and dividends.”
Robertson’s letter does not state the total value of the assets she has remitted, but Robertson had previously acted to shield real estate actions as part of her bid for creditor protection.
An article by the CBC states:
“The widow of cryptocurrency exchange founder Gerald Cotten, as well as a company registered in her name, own $7.5 million of Nova Scotia real estate that was purchased in the past 2½ years.”
The same article also reports:
“Nova Scotia’s property registry shows Robertson, her husband and her company bought 16 properties between May 2016 and October 2018, ranging in price from $94,000 for a waterfront lot in Lunenburg County to $2.5 million for nine row houses in Bedford…The median price for the properties was $346,000. Most of the homes are in metro Halifax…Twelve properties are currently held by Robertson Nova Property Management Ltd., a company registered to Robertson’s home address. She is listed as its president, secretary and sole director.”
Robertson states at the end of her letter that she was, “upset and disappointed with Gerry’s activities as uncovered by the investigation,” and, “believe(s) this settlement is a fair and equitable resolution for QCX and the Affected Users.”