- Crypto Capital Corp operator Reggie Fowler has pleaded guilty to multiple charges of financial fraud
- Crypto Capital Corp illegally helped crypto exchanges with their banking needs
- The company allegedly lost lose to $1 billion of BitFinex’s money in October 2018
Reggie Fowler, a lead figure in defunct shadow bank Crypto Capital Corp, yesterday pleaded guilty to charges of bank fraud, wire fraud and conspiracy following his arrest two years ago. Fowler, who played in the United States Football League (USFL), a short-lived competitor to the National Football League (NFL) that ran from 1983 to 1985, was involved in the famous shadow bank that offered unregulated banking services to numerous cryptocurrency exchanges and was a key player in the Bitfinex/Tether case.
Crypto Capital Corp Was the Exchanges’ Exchange
Fowler’s case is a complex one that stretches back three years to his arrest in April 2019, where he was held on charges of bank fraud and operating an unlicensed money transmitting business. Crypto Capital Corp was the banker to the stars in the crypto exchange world, with Kraken, BitMEX, Bitfinex, and even the ill-fated QuadrigaCX using the platform to get its money into banks.
Unfortunately for Crypto Capital Corp it did this entirely without a license, and its operations made headlines when it allegedly lost $880 million of Bitfinex’s money, leading to the exchange having to borrow the money from Tether, which led to a court case brought by the New York Attorney General’s Office.
Fowler Left With No Choice
Fowler originally planned to plead not guilty, but then changed this to one guilty plea of operating an unlicensed money transmitter in December 2019. However, he then withdrew his offer after being faced with the prospect of having to repay nearly $400 million, which resulted in authorities hitting him with more charges.
Plea negotiations ceased in July 2021, with a trial date set for February 2022. This was pushed to May 16, but a plea deal was back on the table when Fowler’s attorney said last week that his client was, once again, willing to enter a plea.
Despite pleading guilty, Fowler faces up to 90 years in prison, although in reality this will be much lower. Meanwhile, Fowler’s partner in crime, Ivan Manuel Molina Lee, who was arrested in Poland in March 2019, is still fighting his own charges relating to the shadow bank.