QuadrigaCX is one of the major stories in the cryptocurrency industry right now, as the battle continues to return the funds that crypto and fiat investors have lost. In December, the CEO passed from complications associated with Crohn’s disease during international travel but signed everything into his wife’s name before his passing.
It would be logical to assume that she now has access to all of his former property, along with the assets and property that they shared.
However, the aggressive stance that creditors are taking against widow Jennifer Robertson is causing some unwanted public attention. In response to the attention, Robertson has requested the help of the judge in charge of the QuadrigaCX case, asking him to assign a restructuring specialist as the new person in charge of the crypto exchange.
The affidavit filed by Robertson in the Supreme Court of Nova Scotia requested that the chief restructuring officer would be Peter Wedlake. Wedlake is a retired partner and senior vice president at audit firm Grant Thornton. Taking on this role would mean that Wedlake had to take full responsibility for the recovery efforts of $136 million in crypto, which is believed to be held in cold wallets that have not been accessible yet.
Much of the reason for the change in the exchange, apart from the unwanted attention, is due to Robertson’s claims of being unknowledgeable in these legal areas.
Specifically, she stated that neither she or Tom Beasley of QuadrigaCX have “significant experience in the cryptocurrency industry,” nor any “experience with an insolvent business.” Robertson added,
“Further, the public attention my role as director has brought is unwanted, and online commentary which I have reviewed has suggested that I, in particular, am trying to hide assets or am acting contrary to the best interests of [Quadriga and its affiliates], which is not true.”
The motion that was filed with the court says that
“the independence of the CRO would ensure that the interests of all stakeholders are protected and that any alleged concerns in relation to Ms. Robertson’s continued day-to-day involvement with the Companies would be addressed.”
Even though the company was already granted a 30-day stay for the courts, which came with 30 days of protection from creditors, they are requesting an extension of up to 60 more days.
The additional days are supposedly being used to continue looking for the missing crypto assets. The motion further describes the difficulty in retrieving the assets, saying,
“This work in [sic] complicated by the lack of accessible business records of the Companies that one would expect to have on hand, and while significant efforts have been expended in the last three weeks much more needs to be done to try and maximize the recovery for the users.”
Much of the complications with retrieving the cryptocurrency have been in relation to unlocking bank drafts held by third-party payment processors. This difficulty has resulted in a substantial amount of time spent on “addressing those issues,” implying that the company and counsel have simply not had the time to pursue the cryptocurrency.
The request asks for 45 to 60 days, but obviously, QuadrigaCX would prefer to have the latter amount of time. There has already been a petition established amongst creditors that want the court to deny the extension and pursue the company for criminal activities.
Miller Thomson, which is part of the representative counsel of the creditors, has not given any indication if the official motion to deny the extension will happen, and no comments have been given on the matter.
While it is yet to be seen if any of these new motions will be granted, a hearing last week allowed the transfer of the fiat currency holdings available to be moved to QuadrigaCX’s court-appointed monitor, Ernst and Young (EY). The order says that the funds will be deposited into a “Disbursement Account.”
The order to make this transition from Judge Wood came with the following statement –
“[Bank of Montreal] shall have no liability or obligation as a result of the performance of their duties in carrying out the provisions of this Order,” excluding any issues that arise from negligence or “actionable misconduct” on BMO’s part.
In the order, the judge also granted Costodian, a payment processor that held accounts that the Canadian Imperial Bank of Commerce (CIBC) froze, $778,000 CAD ($588,000 USD). Costodian had claimed that this amount was owed to it in fees.