- The QuadrigaCX crypto scandal continues.
- The exchange’s surviving co-founder is facing a new court order.
- The court order seeks to compel the co-founder to explain how he came by some seized assets.
Michael Patryn, a co-founder of defunct crypto exchange QuadrigaCX, is the target of an “unexplained wealth order” seeking to compel him to explain the source of funds used to obtain a cash hoard, gold bars, and luxury watches.
Patryn is the surviving co-founder of QuadrigaCX, a trading platform that collapsed in 2019 due to a Ponzi scheme operated by its CEO and founder, Gerald Cotten. Cotten died unexpectedly in 2018 at the age of 30 while volunteering at an orphanage in India.
British Columbia Authorities Target Patryn
According to a Bloomberg report on March 28, the Director of Civil Forfeiture in British Columbia has sought a court order to force Patryn to explain how he came by over $600,000 in assets, which were seized by the Royal Canadian Mounted Police (RCMP) in June 2021.
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The assets in question include a cash hoard of C$250,200 ($184,250), 45 gold bars, two diamond-studded Rolex watches, Chanel J12 Black Diamond watches, and other jewelry. The assets were seized from a Canadian Imperial Bank of Commerce safety deposit box in Vancouver, along with a 45-caliber Ruger 1911 pistol with ammunition.
While Patryn’s lawyer had intimated in October last year that the seized assets weren’t linked to illegal activity, the co-founder must demonstrate that every item was legitimately acquired or risk forfeiting them.
“Gold bars may be highly liquid and flashy luxury goods, such as jewelry and Rolex watches, attract attention, but they are also attracting the attention of police and our government. If they are the proceeds of criminal activity like fraud, drug trafficking or money laundering, we will go after them,” Mike Farnworth, Minister of Public Safety and Solicitor General, stated.
Per Farnworth, if the assets are forfeited, their proceeds would be donated to crime victims and crime prevention services.
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