| Charged With
Crypto Fraud Alexandre Trial Is March 27
Now Estate To Divest of All Crypto
By Matthew
Russell Lee, Patreon Maxwell
Book
COURTROOM
EXCLUSIVE, Jan 4 – Eddy
Alexandre, charged with
commodities fraud in
connection with a purported
cryptocurrency and forex
trading platform named
EminiFX, was ordered released
on $3 million bond on May 12.
He would be
required to hire his own guard
for home incarceration in
Valley Stream, NY - and not
pay the guard with the crypto
funds.
The bail
decision was reached by U.S.
District Court for the
Southern District of New York
Magistrate Judge Katharine H.
Parker in an hour-long
proceeding on the afternoon of
May 12. Inner City Press was
the only media there, and live
tweeted it here
and below.
Then was June 14,
when Alexandre was arraigned.
Inner City Press again went.
The court room was full (of
supporters), but little to no
media. Inner City Press live
tweeted here
and below.
On November 18,
amid a spat about ex parte
filings between the US
Attorney's Office and
Alexandre's lawyer, ex-US
Attorney's Office Emil Bove,
there was a protest in front
of 500 Pearl Street, demanding
dismissal, and end to racism,
and largely directed at the
receiver, David Castleman. In
the docket, the only link to
November 18 was to a filing:
"The Government shall respond
to the arguments in
Defendant's letter by November
18, 2022. The Government may
make part of its submission ex
parte as necessary." Letter on
Patreon here.
On December 29
Judge Cronan ordered: "ORDER
as to Eddy Alexandre. By
January 3, 2023, the
Government shall file any
affidavits relating to its
applications for search
warrants of EminiFX's office
and of the phone seized
incident to Defendant's arrest
- as referenced in Defendants
motion papers. See, e.g., Dkt.
51 at 15. If the Government
wishes to submit the
affidavits ex parte and for in
camera review, it may
initially make its filing
under seal and ex parte along
with a written submission
explaining why such treatment
is appropriate (Signed by
Judge John P. Cronan on
12/29/22)."
And on December
30, the US Attorney's Office
did respond - with the search
warrants, letter on Patreon here.We aim to
have more on this.
Inner City Press
remains on the case(s).
Back on August 3,
with two overflow courtrooms,
more Alexandre and EminiFX
supporters / investors, a
Curcio hearing and March 27
trial date. Inner City Press
exclusively live tweeted here
and below.
On October 5,
Alexandre and his lawyer Emil
Bove, and apparent supporters,
appeared before Judge Cronan
for argument. Inner City Press
was there and files this:
Bove argues the
receiver coordinated with law
enforcement, had laptop seized
for Alexandre's residence. He
repeatedly calls the AUSAs
"these guys."
Bove tells Judge
Cronan, You know better than I
do that the State
Department can move
faster than a year [under
MLAT]. Pooled CJA counsel for
witnesses?
AUSA: Just
because the receiver, the
company, gave info to the
government doesn't make them
part of the prosecution. Echo
of US v Trevor Milton, roles
of Nikola, Mark Russell...
More to follow.
Back on August 5,
in the parallel CFTC case,
Judge Valerie E. Caproni
approved the receivers request
for nearly $1 million, a
request which included: "Long
Island Real Estate Portfolio.
Soon after the start of the
receivership, the Receiver
discovered that EminiFX had
entered into 46 separate
contracts to purchase
residential properties in Long
Island out of foreclosure,
each in a separate New York
state court action with a
separate court-appointed
referee overseeing the sale.
EminiFX also entered into two
separate real estate contracts
outside of foreclosure. In
addition, Alexandre entered
into a separate contract for a
property using $535,000 in
funds traceable to EminiFX
customers as a deposit. The
total deposits on all
properties totaled over $3
million, and the Receiver and
his team at Raines Feldman and
FDT have been working to
recover as much as possible.
The total amount recovered to
date on the EminiFX contracts
for purchase is $575,200. This
amount plus the court-ordered
turnover of the $535,000
deposit for the Alexandre
contract for purchase brings
the total recovery to over
$1.1 million. The Receiver and
FDT are working to recover the
remaining deposits." Full
letter on Patreon here.
Jump cut to
January 4, 2023, when Judge
Caproni citing the CFTC
ordered the Estate to move out
of crypto: "ORDER granting
[180] Letter Motion to
Expedite. The Court agrees
with the CFTC and the Receiver
that because cryptocurrencies
are highly volatile and
because the holdings of the
Estate will eventually need to
be converted to currency to be
distributed to investors, the
most prudent approach is to
divest from Bitcoin and other
cryptocurrencies. While the
Court is sympathetic to the
concerns of EminiFx investors
that their investments have,
on net, lost value as the
price of Bitcoin has fallen,
this loss highlights the
riskiness of Bitcoin as an
investment vehicle and
demonstrates the need to move
these highly volatile digital
assets into
dollar-denominated, low-risk
assets. Neither the Court, the
Receiver, nor the investors
can know what the future will
bring for the value of Bitcoin
or the other cryptocurrencies
from now until the Estate is
distributed to the investors.
The value could go up, down,
or remain static. In contrast,
the Estate's high-yield money
market accounts are highly
unlikely to decrease in value
and will pay interest,
Receiver Reply at 2;
accordingly, such accounts are
a significantly safer and a
more appropriate investment
vehicle for the assets of the
Estate during the pendency of
the Receivership. Furthermore,
the proposed protocol
appropriately mitigates the
risk posed by Bitcoin's price
volatility by establishing a
process for timely liquidation
while also guarding against
the risk that price
fluctuation on a particular
trading day will decrease the
liquidation price or that the
sale of a large volume of
Bitcoin over a short time
period will depress the price
of Bitcoin. Thus, the
Receiver's motion to approve
the proposed digital asset
management protocol is
GRANTED. The Clerk of Court is
respectfully directed to
terminate the open motion at
docket entry 180. SO ORDERED.
(Signed by Judge Valerie E.
Caproni on 1/4/2023)."
More on Patreon here. And vlog here.
More (bonus) on
Patreon
here.
The civil case is
Commodity Futures Trading
Commission v. Alexandre, et
al., 22-cv-3822
(Caproni)
The criminal case is US v. Alexandre,
22-cr-326
(Cronan)
***
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