The founders of the Gemini digital asset exchange platform have accused their former business partner of not returning Bitcoin they had instructed him to buy on their behalf in 2012. The Winklevoss twins allege that Charlie Shrem owes them a massive 5,000 BTC.
Charlie’s Lavish Lifestyle Prompted Legal Action
Charlie Shrem might have been fortunate enough to get into Bitcoin early, but his luck staying on the right side of the law is certainly more questionable.
The crypto entrepreneur, who served time in 2014 for knowingly providing the means for people to purchase drugs on the dark web with his Bitinstant payment processing service, is once again facing legal difficulties.
The federal lawsuit brought by Shrem’s former partners yesterday dates back to 2012 when the Winklevoss twins loaned Charlie $750,000 to source Bitcoin for their now legendary stash. Shrem had been influential in convincing the brothers of the importance of Bitcoin and its validity as an investment – serving as an adviser to the pair early on. They allege that he did not return the correct number of Bitcoin from the deal and that 5,000 were left unaccounted for.
After the twins realised their balances did not add up, the court documents state that they requested on several occasions for the return of the missing Bitcoin. One email correspondence between Cameron Winklevoss and Shrem stated:
“I have been patient and at this point it’s getting a bit absurd. I don’t take this lightly.”
According to a report in the New York Times, it appears that Shrem will be fighting the allegations against him. His lawyer, Brian Klein, refuted the claims against his client in a statement:
“The lawsuit erroneously alleges that about six years ago Charlie essentially misappropriated thousands of Bitcoins. Nothing could be further from the truth. Charlie plans to vigorously defend himself and quickly clear his name.”
Charlie’s latest legal worries could be about to land him in yet more hot water too. According to a court filing, the early Bitcoin investor still owes the government $950,000 in relation to the Bitinstant conviction. Naturally, this is likely to be raised once again during the Winklevoss case.
Apparently, Cameron and Tyler were inspired to chase Shrem for the Bitcoin that are now worth around $32 million after observing his recent spending habits. Despite stating that he was broke when he went to jail,
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