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QuadrigaCX CEO Used Personal Money to Fund Exchange During Bank Litigation, as per his Wife

Gerry Cotten, the late founder of Canadian cryptocurrency and digital asset exchange QuadrigaCX, was allegedly funding the exchange with his personal money while it was in litigation with a key Canadian bank. Jennifer Robertson, the widow of Cotton, divulged details about the financial situation of the exchange in a statement published on March 13.

Interestingly, the statement reads that Cotten was putting his own money into QuadrigaCX to fund customer withdrawals in 2018 after CIBC had frozen 5 accounts holding $21.6 million. Robertson stated that she had no direct knowledge of how Gerry operated the business. However, he told her that he had been putting his own money back into QuadrigaCX to fund customer withdrawals in 2018 while the CIBC money remained frozen. She believes Gerry had the best interests of the business in mind and cared for his customers.

At the time, the Canadian Imperial Bank of Commerce froze accounts belonging to Costodian Inc., the exchange’s payment processor, and its owner, Jose Reyes, allegedly due to an incapability to recognize the funds’ owners. The Canadian Imperial Bank of Commerce then requested the court to withhold the doubtful funds and settle on whether they belong to QuadrigaCX, Custodian, or the users who had deposited the funds.

Afterward, QuadrigaCX told the court that the bank froze the funds erroneously, and claimed to be the unquestionable possessor of the greater part of the funds as there was “no evidence” of challenging claims.

Robertson asked the court, earlier in March, for $225,000 in compensation for legal costs for financing used to help the cryptocurrency and digital asset exchange get your hands on court-approved protection from creditors. After $145 million in digital assets went missing following Cotten’s death, Robertson provided short-term financing for legal proceedings.

While the subject of repaying Robertson was supposedly discussed in court, Cox & Palmer, the law firm representing QuadrigaCX’s affected clients, argued that repayment should not be granted until E&Y — the court monitor — has scrutinized asset and transaction information from Cotten’s estate.

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