An American CFO has launched into cryptocurrencies in 2021. To finance his speculative investments, he has embezzled millions of dollars belonging to his clients. Bad luck: he lost everything in a few months by betting on dubious crypto …
A few years ago, Cooper Morgenthau, the 35-year-old chief financial officer, was appointed to manage the funds of two Special Purpose Acquisition Companies (SPACs). These are listed companies aimed exclusively at facilitating the introduction of other companies on the stock exchange by means of merger. This is a common process in the world of finance.
In 2021, the financial expert was drawn to the world of cryptocurrencies. That year, the price of Bitcoin exploded to the upside, pulling up all other projects. To achieve commercial operationsMorgenthau decided to dig into the assets of a company under his management, African Gold Acquisition Corp, which specializes in gold mining.
Read also: after the FTX disaster, what does cryptocurrency have in store for us in 2023?
Over 5 million dollars embezzled
Between June 2021 and August 2022 it deviated $1.2 million belonging to the company to finance its business operations. Unfortunately, Morgenthau turned out to be a bad trader. Attracted by the lure of profit, he has bet his clients’ money on the same coins, these cryptocurrencies with no real interest, such as Dogecoin (DOGE) or Shiba Inu (SHIB). The New York prosecutor’s statement indeed speaks of a mixture of stocks, even coins and other cryptocurrencies. In most cases, these meme corners are simple jokes. Sometimes it happens that the price of these cryptocurrencies explodes to the upside. Of course, these increases are always accompanied by a sharp decline.
The strong fluctuations of the tokens have consumed all the stolen assets. Backed into a corner, the chief financial officer tapped into the funds of another company under his management, Strategic Metals Acquisition Corp, to cover losses. He then embezzled another $4.7 million. These funds were promptly injected into trading operations.
While the cryptocurrency market has been on a downward trend since early 2022, stolen funds from Morgenthau have dwindled to a trickle. In the end, the financier lost almost everything. To hide her abuse of him, he tried everything forging official documents and bank statements. Despite the smokescreens put in place, African Gold became aware of the deception last August. The company immediately ceased working with the chief financial officer. Soon after, American justice entered the scene.
electronic fraud
The case remembers the Sam Bankman-Fried case. Mirroring Cooper Morgenthau, the founder of FTX misappropriated funds entrusted by his clients to finance trading operations. Through the platform, user resources ended up in the hands of Alameda Research. The trading company that made Sam Bankman-Fried’s fortune. Due to risky investments and poor financial management, a large part of the entrusted cryptocurrencies has disappeared.
Seen from this angle, the FTX affair is no different from the other cases of embezzlement that dot traditional finance. Unlike FTX’s founder, Morgenthau pleaded guilty to wire fraud. He has ” admitted to having broken the trust it owed to its public and private investors”. The former financier faces up to 20 years in prison.
Source :
Reuters