The director of crypto asset escrow company Volantis Market Making guiltied to commodities fraud worth more than $3.25 million
According to the US Department of Justice (DoJ), Jon Thompson, the director of Volantis Escrow Platform LLC and Volantis Market Making, has admitted to committing a multimillion-dollar crypto scam. Specifically, he committed fraudulent goods worth more than $ 3.25 million to make purportedly no risk Bitcoin purchases through a third firm during June and July of 2018.
A crypto escrow Volantis Market Making executive has pled guilty to defrauding his client out of $3.25 million
Last July, the US Department of Justice charged Thompson with two counts each of wire fraud and commodities fraud for taking $ 7 million from clients and agreeing to provide them with Bitcoin — and then not delivering. Fourteen months later, he’s pled guilty to one count of commodities fraud, the US Attorney’s Office for the Southern District of New York today announced.
Despite Thompson asserting he would not part with the money until after the third firm had delivered the BTC, Acting Manhattan U.S. Attorney, Audrey Strauss, found that:
“Thompson sent the money to a third party without first receiving the Bitcoin, and the money was never recovered.”
This specific case deals with just one of multiple clients Thompson allegedly defrauded. The unidentified company sent Thompson $ 3.25 million to buy Bitcoin under the belief — perpetuated by Thompson — that Volantis would act as an escrow account. It would take dollars from one party, Bitcoin from the other, and distribute the appropriate amounts back to each party after those transactions settled.
DoJ notes that:
“Thompson falsely that the transaction would be settled through an atomic swap process and lied to the company for several days as to the status of their funds and crypto – neither of which were returned.”
Thompson pledges a crime of commodity fraud, serving a maximum sentence of up to 10 years in prison. Thompson will face a verdict on January 7, 2021.
In the indictment, Assistant Director in charge of FBI, William Sweeney Jr, emphasized that Thompson had intentionally used crypto-native jargon to confuse and thus exploit his victim:
“Using phrases and terminology that the victim companies didn’t understand, he allegedly preyed on their ignorance of the emerging cryptocurrency.”
While Thompson had pledged not to part with the company’s money until he had possession of the Bitcoin, in fact, Thompson sent the money to a third party without first receiving the Bitcoin, and the money was never recovered, which is not how an escrow account works.
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