Bitcoin CEO spent embezzled funds on prostitutes: reports

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TOKYO: The head of collapsed Bitcoin exchange MtGox was facing fresh embezzlement charges Wednesday, as Japanese media said some of the allegedly stolen funds were spent on prostitutes. Tokyo police said they had arrested France-born Mark Karpeles, 30, for moving 20 million yen ($166,000) in client money to his bank account, as he faces fraud allegations over the disappearance of hundreds of millions of dollars worth of the virtual currency. Japan’s top-selling Yomiuri newspaper reported that the defunct firm’s chief had spent an unspecified sum on prostitutes, while the Jiji Press news agency, citing police, said it involved “several women whom he met at venues that offer sexual services.” The Tokyo-based exchange shuttered last year after admitting 850,000 coins — worth around $480 million at the time, or $387 million at current exchange rates — had disappeared from its digital vaults. The company initially said there was a bug in the software underpinning Bitcoins that allowed hackers to pilfer them. Bitcoins are generated by complex chains of interactions among a huge network of computers around the planet, and are not backed by any government or central bank, unlike traditional currencies.

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AFP

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