Arizona-resident Reginald Fowler pleaded guilty to providing shadow banking services through Crypto Capital’s Panamanian processing arm. The Block reports The Block.
At the end of 2019 the man planned to partial plead guilty to a number of charges. He later withdrew the plans because of a condition under which authorities could seize $371 million from him.
In a remote hearing on 25 April 2022, Fowler pleaded guilty to all counts, including conspiracy and illicit transfers. The maximum penalty in his case is 90 years’ imprisonment.
The final sentence will be handed down on August 30.
Crypto Capital — a key figure in the Bitfinex case against the State of New York. It was to this Panamanian processing arm that the exchange entrusted $850 million for safekeeping. As a result, it lost access to the funds, and authorities charged the platform with attempting to conceal the loss and to replenish the shortfall with funds from the issuer of the affiliated stablecoin Tether.
Along with Fowler, charges of bank fraud have been brought against Israeli national Ravid Yosef and her brother Oz Yosef. The latter was the founder of Crypto Capital, through which the illicit operations were conducted. Both defendants remain at large.
In early February 2021, Bitfinex repaid a loan to Tether. In the same month, the companies entered into an agreement with the New York State Attorney General.
Under the settlement terms, Bitfinex and Tether agreed to pay $18.5 million to the state, publish information about their reserves, and cease servicing local customers. However, they did not admit the wrongdoing by the firms.
In October 2020, Fowler stated his willingness to plead guilty.
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