A Vancouver-based cryptocurrency platform director faces severe consequences after admitting to fraud, resulting in a $1 million settlement and a permanent ban from the B.C. investment market. Michael Ongun Gokturk, a key figure in the now-defunct Einstein Capital Partners Ltd., Einstein Exchange Inc., and Einstein Law Corporation, collectively known as the Einstein Corporations, has been held accountable for his actions. The companies, which operated a crypto trading platform marketed as a safe and secure environment for buying, selling, and storing digital assets, were found to have committed fraud. Gokturk, a B.C. resident, accepted customer deposits and transferred funds into various corporate accounts and third-party wallets between September 2017 and November 2019. This practice was in violation of the promised 'safe and secure method' for cryptocurrency transactions. The BCSC noted that Gokturk's actions did not involve misappropriating client funds, speculative trading, or personal profit, but the platform's operations and customer withdrawals were funded using customer assets, which was the fraudulent aspect. The BCSC's statement emphasizes the importance of using registered platforms for crypto transactions, as unregistered platforms pose significant risks to investors. The $1 million payment is the maximum administrative penalty for such misconduct, and Gokturk's ban from the investment market includes restrictions on directorial and officer roles, as well as management and consultative positions related to securities and derivatives markets. The Einstein Corporations were dissolved in 2020 with no remaining assets, and the platform held less than $45,000 in cash and cryptocurrency, while customer liabilities exceeded US$18 million. This case highlights the importance of investor vigilance and the regulatory measures in place to protect the cryptocurrency market.
