The Australian Securities and Investments Commission (ASIC) has initiated legal proceedings against a former executive of a cryptocurrency exchange, charging him with fraud. Grant Colthup, the ex-CEO of ACCE Australia, which operated the Mine Digital crypto exchange, is accused of misappropriating approximately $1.5 million from one of the platform’s customers.
ASIC announced the charges on Tuesday, revealing that Colthup is facing one count of fraud. He made a court appearance on Monday, and the case has been adjourned until 16 December 2024. The charges followed a regulatory investigation triggered by a customer complaint.
ACCE operated Mine Digital from May 2019 until September 2022. The complaint that led to the fraud charge came from a customer who had deposited $1.5 million with the exchange to purchase Bitcoin but never received the cryptocurrency. ASIC alleged that Colthup had diverted the funds to settle ACCE’s liabilities or to purchase cryptocurrency for other individuals.
ACCE entered liquidation on 23 September 2022, with Brad Tonks of PKF appointed as the liquidator on 1 December 2022.
This action against Colthup comes in the wake of ASIC’s recent legal challenge involving Block Earner, another cryptocurrency company offering interest-bearing products. In that case, the courts ruled in favor of Block Earner, determining that the company had acted honestly and without negligence, despite ASIC’s argument that the firm required a financial services license to operate.
Meanwhile, Australian regulators are working on new guidelines that will require cryptocurrency exchanges to obtain financial services licenses, expanding the scope of current regulations. Recent amendments to Australian legislation have also extended ASIC’s regulatory authority to cover a wider range of capital market entities, including financial market operators, benchmark administrators, clearing and settlement facilities, and derivative trade repositories.
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