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QuadrigaCX CEO Used Personal Money to Fund User Withdrawals During Bank Litigation in 2018

By Katelyn James | March 16, 2019
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QuadrigaCX CEO Used Personal Money to Fund User Withdrawals During Bank Litigation in 2018

On March 13 statement, Jennifer Robertson, QuadrigaCX CEO’s widow, revealed that her ‘dead’ husband had used his own money to fund customer withdrawals in 2018, while the Canadian Imperial Bank of Commerce (CIBC) was frozening five bank accounts which held $21.6 million.

“While I had no direct knowledge of how Gerry operated the business, he told me that he had been putting his own money back into QCX to fund user withdrawals in 2018 while the CIBC money remained frozen. I believe Gerry had the best interests of the business in mind, and cared for his customers.” she said.

Also by that time, the CIBC froze several accounts belonging to the exchange’s payment processor, Costodian Inc., and its owner, Jose Reyes. Since CIBC was unable to determine the money’s rightful owners, the bank requested the court to take possession of the funds and decide whether they belong to QuadrigaCX, Costodian or the 388 people who made deposits.

Meanwhile, Quadriga claimed to be the undisputed owner of the majority of the funds and that CIBC was wrong to freeze the accounts.

Robertson also revealed the conflict of interest by representing law firm, Stewart McKelvey. “I have been advised by Stewart McKelvey that, in light of concerns regarding a potential conflict of interest that have been raised as a result of information which has come to the attention of the Monitor since the start of the CCAA [Companies’ Creditors Arrangement Act] process, they have withdrawn from representing QuadrigaCX (QCX) and the other applicant companies in the CCAA process.” she continued.

In March, after losing $145 million in crypto assets, the Quadriga CX widow asked $225,000 in repayment for costs associated with QuadrigaCX’s creditor protection proceedings. The request has brought Cox & Palmer, the law firm representing users of QuadrigaCX to ask Big Four firm EY to review the asset of Cotten’s estate.

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