The United States Government Arrests Jon Montroll, Founder of Bitcoin Stock Exchange BitFunder

The United State government has arrested Jon Montroll, the founder of BitFunder, a bitcoin stock exchange company. The charges against him were today revealed by the United State Justice Department after an investigation that involved Securities and Exchange Commission (SEC) and Federal Bureau of Investigation (FBI). In a separate action, SEC is pursuing civil charges against Jon Montroll, alleging that he defrauded investors and operated unlicensed security exchanges.

According to the United States Attorney’s Office Southern District of New York, he was arrested on Wednesday. The details of this case can be traced back to the early period of bitcoin history when cryptocurrencies stock exchange websites like BitFunder was common. The site was shut down in late 2013 and stood as a kind of accomplice service to WeExchange, a cryptocurrency exchange.

As the Department of Justice laid out, the company as the target of hacking allows the perpetrators to credit themselves funds. As a result of this, about 6,000 bitcoins were withdrawn from WeExchange and thus making the services insolvent. In November 2013, Prosecutors allege that Jon Montroll in connection with the investigation into BitFunder’s activities provided a sworn testimony to Securities and Exchange Commission New York Regional Office. He submitted a balance statement as part of that testimony; showing the total amount of bitcoins that is available to its users in the WeExchange Wallet. The report shows a rough amount of 6,700 bitcoins as at the 13th of October, 2013.

According to SEC statement, Jon Montroll is also accused of misleading its staff after being challenged by SEC investigators. While admitting that the balance statement was as a result of his manual intervention, he, however, claimed it was after SEC questioned him on the first day of his testimony that he discovered the outcome of the Exploit.

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