Feeds

Hundreds of folks ready to sue Bitcoin exchange MtGox

Brit-based firm says it's getting ready to file hefty class action lawsuit

Boost IT visibility and business value

Over 400 people have expressed an interest in joining a class action lawsuit against Bitcoin exchange MtGox, according to a British-based law firm.

Selachii has been gathering up investors stung by the collapse of the exchange and the prospect that it may have lost 750,000 of its customers' Bitcoins and 100,000 of its own, totalling around $480m.

The firm said on its blog that "a class action by investors seems to be the only logical action that can be taken". MtGox is already being sued in the US for alleged negligence and fraud.

Selachii is planning to take the parent company of MtGox, KK Tibanne, and MtGox chief Mark Karpeles to court in London after it finishes finding potential claimants on Friday this week.

Richard Howlett, the co-founder of the law firm, told Reuters that there were more than 400 people already signed up "from every country you can think of".

He said it was impossible to say at this point what had caused the Bitcoin exchange to collapse, but the suit would take issue with the lack of disclosure by the exchange and the deposits made by customers right before the collapse.

"One of the problems and main issues that is leading to suspicion is the lack of information coming from MtGox," he told The Reg. "It is unknown at this stage if fraud is involved but this is something that will come out in disclosure."

MtGox has admitted on its website that it may have lost hundreds of thousands of Bitcoins "through the abuse of a bug in the Bitcoin system". The exchange is still only talking about the possibility of the Bitcoins having been stolen, though most users have already accepted that whatever happened, their Bitcoins are likely gone for good.

The exchange has claimed to have 127,000 creditors and liabilities of 6.5bn ($64m), with assets of just 3.84bn ($38m).

Howlett said that the investors who want to pursue the lawsuit just want their money and/or Bitcoins back.

"If MtGox contacted us today, we could resolve this without the necessity of a class action," he said. ®

The Essential Guide to IT Transformation

More from The Register

next story
Just TWO climate committee MPs contradict IPCC: The two with SCIENCE degrees
'Greenhouse effect is real, but as for the rest of it ...'
'Blow it up': Plods pop round for chat with Commonwealth Games tweeter
You'd better not be talking about the council's housing plans
Arrr: Freetard-bothering Digital Economy Act tied up, thrown in the hold
Ministry of Fun confirms: Yes, we're busy doing nothing
Government's 'Google Review' copyright rules become law
Welcome in a New Era ... of copyright litigation
Help yourself to anyone's photos FOR FREE, suggests UK.gov
Copyright law reforms will keep m'learned friends busy
Apple smacked with privacy sueball over Location Services
Class action launched on behalf of 100 million iPhone owners
Adam Afriyie MP: Smart meters are NOT so smart
Mega-costly gas 'n' 'leccy totting-up tech not worth it - Tory MP
prev story

Whitepapers

Implementing global e-invoicing with guaranteed legal certainty
Explaining the role local tax compliance plays in successful supply chain management and e-business and how leading global brands are addressing this.
Boost IT visibility and business value
How building a great service catalog relieves pressure points and demonstrates the value of IT service management.
Why and how to choose the right cloud vendor
The benefits of cloud-based storage in your processes. Eliminate onsite, disk-based backup and archiving in favor of cloud-based data protection.
The Essential Guide to IT Transformation
ServiceNow discusses three IT transformations that can help CIO's automate IT services to transform IT and the enterprise.
Maximize storage efficiency across the enterprise
The HP StoreOnce backup solution offers highly flexible, centrally managed, and highly efficient data protection for any enterprise.