- A court examiner’s report has revealed that the CFO is Cred was an escaped British convict
- James Alexander escaped a British prison in 2007 and wound up being in a position of great power within the company
- Alexander is accused of stealing some $3 million worth of cash and funds from Cred before its demise last year
The Chief Financial Officer (CFO) of Cred, who was accused of stealing $3 million worth of Bitcoin last year as the company sought to rescue itself from a financial black hole, has been outed as an escaped inmate from a British prison. In a stunning turn of events, a legal filing in one of two cases involving Cred’s bankruptcy contains a discovery by the court examiner that James Alexander was convicted of money laundering in 2007 but escaped during a prison break shortly after his incarceration and ended up running Cred’s money management operations.
Cred Management Responsible for Failure, Says Examiner
Cred billed itself as a blockchain banking solution, but catastrophic management led to it collapsing into bankruptcy late last year and owing $140 million to users. The examiner lays the blame squarely at Cred CEO Dann Schatt, the Cred board, and its employees for the poor due diligence both in recruiting Alexander and for the way they handled customer funds.
The examiner states that no one at the company “appears to have conducted any meaningful diligence (e.g., background search, credit check) with respect to Mr. Alexander either prior to his hiring or during his period of employment”, before going on to detail the upshot of this lack of care:
…Mr Alexander was convicted on December 3, 2007 in the United Kingdom for crimes related to illegal money transfers, for which he was sentenced to three years and four months in prison to be served at HMP Ford Prison in West Sussex, England. At the time of his incarceration, there was a prison break at this facility. Mr. Alexander has been identified by the UK government as a fugitive.
This incredible revelation is amateurish, even for the cryptocurrency industry, and it is no surprise that the company didn’t survive after dealing with loan sharks and margin trading with investors’ money.
Alexander Accused of Stealing Millions
When things began to go south for Cred and Alexander’s poor money management was uncovered, the wanted man “promptly transferred to his personal accounts $200,000 USD and 225 Bitcoin of Cred’s assets”, amounting to a theft worth close to $3 million. Given his previous crimes, this should have come as no surprise to the Cred founders – had they been bothered to find out at the time.
Cred is currently going through bankruptcy proceedings in Delaware, but with the level of debt they incurred it is unlikely that those who lost money will get any back as a result, leaving the incident as another example of why calls for regulation of the space are gathering pace globally.