Crypto Escrow Firm Chief Charged Over Alleged $7 Million Fraud

The head of a bitcoin escrow service faces decades behind bars if found guilty on charges of bitcoin-related fraud.

According to U.S. Attorney's Office of the Southern District of New York, Jon Barry Thompson of Volantis Market Maker is accused of committing two counts each of commodities and wire fraud for false claims concerning the acquisition and sale of $7 million worth of bitcoin.

In a complaint filed earlier this summer, a grand jury alleged that Thompson defrauded two companies out of funds intended for bitcoin purchases in 2018.

One of the fraudulent transactions is claimed to have occurred in June and July 2018, with "Company-1" giving Thompson $3 million to facilitate tranches of bitcoin purchases.

The complaint states Thompson sent the funds to a third-party escrow service which never purchased the bitcoin promised or returned the funds.

Thompson repeatedly lied to Company-1 on the state of the transaction and where the bitcoin resided, saying "Cash is with me, coin is with me."

Company-1 neither received the bitcoin promised nor had its $3 million returned, according to Attorney's Office.

In March 2018, Thompson entered into a contract with Symphony as a facilitator in a $4 million bitcoin purchase.

Under the state of Pennsylvania's current commodities and wire fraud laws, Thompson could face up to 60 years in prison for all four counts.

"As alleged, Jon Barry Thompson repeatedly lied to investors in cryptocurrencies about the safety of their investments made through his companies. As a result of Thompson's lies, investors lost millions of dollars."