National / Crime & Legal

Creditors sue CEO of failed Mt. Gox for damages from bitcoin losses

Kyodo

Three creditors of Mt. Gox, a Tokyo-based bitcoin exchange operator that went bankrupt in February, have filed a lawsuit with the Tokyo District Court, demanding that its CEO, Mark Karpeles, pay ¥23.5 million in damages, it was learned Wednesday.

Mt. Gox announced in February that it had lost 850,000 bitcoins, worth some ¥48 billion at the rate of exchange at the time, filing for bankruptcy procedures. Mt. Gox officials have explained that the coins were stolen from the firm’s computer system through unauthorized access by outsiders.

But the plaintiffs of the suit maintained that Karpeles had been “aware of the possibility of illicit withdrawals (of bitcoins) due to fragility of the firm’s (computer) system.”

“The firm committed a grave act of negligence by failing to take necessary measures, which led to the loss of clients’ bitcoins and a failure of the company,” the suit said.

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