Digital asset exchange Bitfinex recently applied to a US court to subpoena a former senior banking official of a trust company that the exchange says could help it recover more than $850 million in frozen funds.
On October 18, Bitfinex submitted a filing to a California court in order to receive permission to take the deposition testimony of Rondell “Rhon” Clyde Monroe, former VP at TCA Bancorp. The exchange also seeks to obtain records of Monroe’s conversations with staff members at Crypto Capital, the payment processor that has allegedly been holding Bitfinex’s funds.
In the filing, Bitfinex’s management claims that Crypto Capital’s staff “has used one or more accounts held at TCA Bancorp to facilitate the transfer of funds,” which belong to itself. The exchange operator believes Monroe might have the documents and information needed to support its claims to more than $850 million.
Bitfinex’s recent filing has come as part of the on-going legal proceedings where the company is trying to recover $880 million of its funds allegedly held at Crypto Capital, a digital currency payment processor. According to previous reports, the funds were frozen by several different government agencies.
At present, Bitfinex is being investigated by the New York Attorney General’s (NYAG) Office for allegedly taking out a loan from Tether Ltd., in an attempt to cover up the loss of funds without informing its customers.
In the filing, Bitfinex noted that its relationship with Crypto Capital was going well until April 2018 when reports surfaced that funds at the payment processor had been confiscated by Poland’s authorities as part of a money-laundering investigation.
In August 2018, Bitfinex stated that Crypto Capital’s management had claimed that around $500 million of its funds in Poland and Portugal were “held up” by authorities. The exchange noted that it pressurized Crypto Capital’s management to provide more details regarding the frozen funds. The company reportedly provided a reference letter, which had been signed by Monroe.
The letter reportedly presented the custody of approximately $300 million of Bitfinex’s funds held at TCA on behalf of Global Trade Solutions AG (GTS), which was operating under the name, “Crypto Capital.”
Bitfinex is now applying to take Monroe’s deposition testimony, in addition to records of his conversations with with Ozzie Yosef, principal at Crypto Capital; Yosef’s sister Ravid Yosef; Reginald Dennis Fowler, sole shareholder of GTS; and Fowler’s son Trent Dennis Fowler, a registered holder for accounts used by Crypto Capital to process deposits from Bitfinex’s clients.
Reginald Fowler and Ravid Yosef were indicted by the US Justice Department for committing bank fraud related to depositing funds at digital currency exchanges.