The company that owns and operates the well-known BitMEX exchange has been accused of money laundering.
This is a lawsuit filed by BMA LLC in the Northern District Court of California, USA, against HDR Global Trading Limited, ABS Global Trading, and co-founders Arthur Hayes, Ben Delo and Samuel Reed.
The allegations are that they engaged in illegal activities including money laundering.
In the 106 pages of documentation, BitMEX is accused of being specifically designed to be involved in illegal activities such as racketeering, money laundering and market manipulation, and of making billions of dollars in illicit profits.
The allegations are serious and substantiated, so the court is unlikely to take them seriously.
BitMEX has also been accused of operating an unlicensed money transfer business, having processed an average of $3 billion a day in violation of US federal statutes.
This, according to the accusers, would be a record volume for this type of illegal activity in the entire history of US monetary regulation.
Although HDR is based in Seychelles, it also has offices in San Francisco, Hong Kong and Singapore, and the San Francisco office would be the largest of all. That is why the lawsuit was filed in California, and it cites US monetary regulations.
Hayes, Delo and Reed are accused of creating ABS Global Trading as a fake shell company to claim that BitMEX does not operate in California or the United States, while instead most of its technology and services would be managed and developed in California, where almost all key personnel would be located.
However, BMA LLC’s motives for suing HDR Global Trading Limited and ABS Global Trading are not known, whereas a spokesman for HDR has stated:
“We’re aware of a complaint filed by ‘BMA LLC’, formerly known as ‘Bitcoin Manipulation Abatement, LLC’, in the US District Court for the Northern District of California. Having reviewed a draft version of their complaint, which is clearly rehashed from information culled from the internet, we confirm we will be defending ourselves vigorously against this spurious claim.
BMA has recently emerged as a serial filer of claims against companies operating in the cryptocurrency space, and is widely recognized for operating just like a patent troll,” the spokesperson added. “We will deal with this complaint through a normal litigation process and are entirely confident the court will see the claim for what it is”.