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MtGox boss Karpeles ordered to Dallas to face bankruptcy probe

Failed Bitcoin exchange CEO must say 'sayonara' to Tokyo

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MtGox CEO Mark Karpeles has been ordered by a judge to return to the US to face questions over his bankruptcy filing with a Dallas court and how 750,000 Bitcoins went AWOL.

Bankruptcy judge Stacey Jernigan ruled that Karpeles must appear at the Dallas office of his lawyers Baker & McKenzie on 17th April. This is ahead of a May 20 hearing which will decide whether the Bitcoin exchange will be granted Chapter 15 protection from creditors.

“If he avails himself of this court, my God, he is going to get himself over here,” Jernigan said at a hearing on Tuesday, according to Reuters.

Karpeles filed for bankruptcy in February after admitting his firm, once the world’s biggest Bitcoin exchange, had “lost” 750,000 of its customers’ Bitcoins and 100,000 of its own “due to weaknesses in the system”.

Tokyo-based MtGox then claimed to have found 200,000 in “old format wallets” a few weeks later, which still leaves around 650,000 unaccounted for.

Lawyers told Tokyo District Court that MtGox has debts of ¥6.5bn (£38.1m, $63.8m).

Angry customers, including those who have filed a class action suit against MtGox in a Chicago court, will be hoping Chapter 15 protection is not forthcoming next month.

They’re owed over $400m in lost Bitcoins and will be further irked by recent reports citing “current and former employees” which claim some of this cash may have been “diverted to cover operating costs”. ®

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