Even before MtGox declared bankruptcy protection, the ex-Bitcoin exchange was having internal problems. In fact, two years before filing for bankruptcy, around six employees challenged MtGox CEO Mark Karpeles about the details of their clients’ money. The employees wanted clarification on whether or not their clients’ money was being used to cover the company’s costs, according to Reuters.
Employees Challenged MtGox
In early 2012, employees challenged MtGox’s CEO by questioning how MtGox handled their clients’ hard earned money. This mystery is a main part behind understanding the details behind the Bitcoin exchange’s crash.
Police and a bankruptcy administrator are trying to figure out how MtGox, being a dominate figure in the Bitcoin trading world, managed to lose over $27 million in cash and $450 million worth of bitcoins. More than one million people invested in MtGox and had trusted the exchange to keep their bitcoins’ secure until they wanted them back.
However, MtGox users will have to wait until at least May for the court to decide if the users will be able to get some of their deposits back from the exchange. This is due to the fact that investigation is going on to determine what exactly happened at the exchange.
MtGox Employees Speak Out
Former and current MtGox employees spoke to Reuters in an interview about the strains MtGox faced over handling a hoard of customers’ wealth as the company aimed to expand further.
According to Reuters, in early 2012, a couple of employees challenged MtGox about what it was doing with users’ money. They worried that customers’ money was being used to cover increasing operating costs.
The concerned employees asked for a meeting with Karpeles to say that MtGox was spending more than it was getting. They were also worried about the fact that the company’s costs were being paid by customers’ unknowingly. However, Karpeles told the employees that MtGox clients were not paying for the company’s expenses. Even as he said this, Karpeles refused to tell them how MtGox was able to pay any losses.