What happened: B.C. Securities Commission has received court approval to protect assets related to the Einstein cryptocurrency exchange
Why it matters: The regulator says Einstein owes customers more than $16m
The B.C. Securities Commission (BCSC) says it’s taking action to protect customers of the Vancouver-based Einstein cryptocurrency exchange.
The regulator revealed Monday (November 5) it had been fielding complaints from customers claiming they could not access assets on the Einstein Exchange Inc. platform.
A shareholder and “another individual associated with Einstein” also raised concerns about potential money laundering and improper use of funds, according to court documents.
On November 1 the BCSC applied to the Supreme Court of B.C. for an order to appoint an interim receiver to preserve and protect assets related the Einstein Group, which includes founder and sole director Michael Ongun Gokturk, Einstein Capital Partners Ltd., Einstein Exchange Inc. and Einstein Law Corporation.
The court then appointed business services firm Grant Thornton LLP to enter and secure Einstein Exchange’s offices in downtown Vancouver the same day.
The BCSC’s own investigation concluded that Einstein owes customers approximately $16.3 million.
The regulator said it was informed on October 31 by a lawyer representing Einstein that the company planned to shut down in 30-60 days due to lack of profit.
When the BCSC asked the lawyer to provide information on the location of where Einstein’s cryptocurrency assets were being stored, the lawyer responded two hours later to inform the regulator they were no longer representing Einstein.
The BCSC’s lead investigator with the enforcement division visited Einstein’s office the next day and found the elevator locked for all floors.
Grant Thornton is urging creditors to contact them at Einstein.Receivership@ca.gt.com.
When Business in Vancouver called Gokturk’s mobile phone number, a reporter was directed straight to the voicemail greeting.
The greeting immediately disconnected after a person identifying himself as Gokturk asked that callers not leave a voicemail but text him instead.
Updated November 5, 8:40 a.m.: Gokturk said in a text message he could not comment on the matter as it is before the courts.