Widow of QuadrigaCX founder to hand over most assets in settlement

Online exchange, which launched in 2013 and grew to become one of Canada’s largest with 363,000 customers

The widow of the founder of QuadrigaCX has agreed to hand over most of her assets in a settlement reached as part of bankruptcy proceedings for the now defunct cryptocurrency exchange.

The settlement says Jennifer Robertson and the estate of her late husband, Gerald Cotten, are to return about $12 million in assets to help repay users of the exchange. Those assets include properties in Nova Scotia and British Columbia, a small aircraft, “luxury vehicles,” a sailboat, investments, and cash, along with gold and silver coins.

The funds are only a fraction of the $214.6 million in cash and cryptocurrency that more than 76,000 unsecured users have claimed following the collapse of the exchange after Cotten’s death last December.

The online exchange, which launched in 2013 and grew to become one of Canada’s largest with 363,000 customers, offered a platform for trading and storing digital assets like Bitcoin, Litecoin and Ethereum.

The exchange was already facing liquidity issues before the death of Cotten, who was chief executive and sole director, but employees found they were unable to locate or access most of the cryptocurrency assets after he died.

An investigation by creditor monitor Ernst and Young found the exchange had flawed financial reporting and that significant volumes of cryptocurrency had been transferred to personal accounts controlled by Cotten. It found losses from trading and fees in those accounts affected QuadrigaCX’s reserves, while Cotten also created fake accounts on QuadrigaCX to inflate revenue figures.

Robertson said in a statement that she wasn’t aware of how her husband operated the business, or his appropriation of users funds.

ALSO READ: QuadrigaCX founder transferred customers’ funds to his own accounts: report

“I had no direct knowledge of how Gerry operated the business prior to his death, and was not aware of his improper actions in managing the QuadrigaCX business.”

The monitor said that to its knowledge, neither Cotten nor Robertson had material sources of income other than funds received from QuadrigaCX, though neither reported income from the company on tax returns in recent years.

Robertson said that she has agreed to return assets she thought were purchased with legitimately earned proceeds from the company.

“I was upset and disappointed with Gerry’s activities as uncovered by the investigation when I first learned of them, and continue to be,” she said.

Robertson will be able to keep about $90,000 in cash, $20,000 in retirement savings, a Jeep, and some jewelry and furnishings as part of the settlement.

The assets handed over by Robertson will add to the roughly $32 million in cash plus $1 million in cryptocurrency that Ernst and Young has already recovered from QuadrigaCX.

Robertson said she hopes the settlement will allow users to be repaid as much as possible while keeping fees as low as possible.

“I believe this settlement is a fair and equitable resolution for QCX and the affected users…in return, this settlement will allow me to move on with the next chapter of my life.”

Ian Bickis, The Canadian Press

Like us on Facebook and follow us on Twitter.

Just Posted

Algae bloom kills over 200k farmed fish near Tofino

“We’re trying to rebuild fish stocks in Clayoquot Sound and it is disheartening to hear of this news.”

BC Transit plan rolls through public process in Tofino and Ucluelet

“I’m thankful that the residents on the Coast are allowing this process to continue on.”

Ucluelet cancels Harbour Lights Sail Past

“Of course it’s disappointing. It’s one of my favourite community events.”

Campbell River mom’s iPhone containing priceless photos stolen from Victoria hospital parkade

The phone contained photos, heartbeat recordings of her late son

Ucluelet Aquarium wraps up season with release day event

Residents help release charismatic critters on Dec. 7.

VIDEO: Octopus, bald eagle battle after bird ‘bites off more than it can chew’ in B.C. waters

B.C. crew films fight between the two feisty animals in Quatsino off north Vancouver Island

Raptors fans show Kawhi the love in his return to Toronto

Leonard receives championship ring, leads new club to win

Process to identify those killed in Gabriola plane crash could take days

Canadian flight museum suggests Alex Bahlsen of Mill Bay died in Tuesday’s crash

One man dead after car crash in Nanaimo

One person died, another was injured in the accident which happened Wednesday on Nanaimo Lakes Road

‘Honest mistake:’ RCMP says B.C. cannabis shop can keep image of infamous Mountie

Sam Steele wearing military, not RCMP uniform in image depicted in Jimmy’s Cannabis window

B.C. conservation officers put down fawn blinded by pellet gun on Vancouver Island

Young deer found near construction site in Hammond Bay area in Nanaimo, B.C.

Laid-off forest workers converge on B.C. legislature

Loggers call for action on strike, provincial stumpage

B.C. guide fined $2K in first conviction under new federal whale protection laws

Scott Babcock found guilty of approaching a North Pacific humpback whale at less than 100 metres

Feds urge Air Canada to fix booking problems as travel season approaches

The airline introduced the new reservation system more than three weeks ago

Most Read