Mt. Gox May Have Used Customer Funds for Operating Costs, Luxuries

Eric Calouro
By Eric Calouro March 30, 2014 09:54

Mt. Gox May Have Used Customer Funds for Operating Costs, Luxuries

Karpeles Bows Media

In an exclusive report published Saturday on Reuters, the question as to how Mt. Gox handled customer money before their catastrophic downfall in February 2014.

Interviews with current and former employees of the company indicated that by 2012 (before the tremendous growth of bitcoin to over $1,000 per unit in late 2013), they became worried that the company might be spending customer funds to cover operational costs which were rising with bitcoin’s increased popularity.

The report also indicates that Mt. Gox spent customer money on renting office space in the same tower that houses Google and Hulu offices, a robot, a 3-D printer, and a tricked-out Honda Civic that was imported from the United Kingdom for the company’s CEO, Mark Karpeles.

These employees reportedly requested to meet with Karpeles in 2012 to inquire as to whether or not the funds were being used appropriately. In that meeting, they asked Karpeles if Mt. Gox was spending more money than it was bringing in.

In that hour-long meeting, Karpeles denied that expenses were coming from the account used for customer deposits, but refrained from explaining how operating costs were being covered.

Mt. Gox is currently under investigation in Japan. Last week, the company announced that the investigation deadline had been extended. [source: Reuters]

Eric Calouro
By Eric Calouro March 30, 2014 09:54

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