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Ex-MtGox chief pleads innocent

The Associated Press

Mark Karpeles speaks at a press conference at the Justice Ministry in Tokyo on Tuesday.

Jiji Press TOKYO (Jiji Press) — Mark Karpeles, former head of MtGox Co., the failed operator of an exchange for virtual currency bitcoin, pleaded innocent to corporate embezzlement at the first hearing of his trial at the Tokyo District Court on Tuesday.

According to the indictment, Karpeles, 32, embezzled a total of ¥341 million in 2013 by transferring customers’ money to his account. He allegedly used the funds for purposes such as buying a luxury bed and the right to develop software. Karpeles offered a deep apology for causing trouble to a number of customers. But he denied the allegations, claiming that he spent less than he earned and made reports to his accountant.

Meanwhile, prosecutors said that MtGox failed to separately manage customer money and corporate funds. A MtGox employee once asked Karpeles how much customer money he used and whether he covered deficits with such funds, they said.

MtGox was established in Tokyo in 2011. Bitcoin trading volume on the exchange operated by the firm used to account for 70 percent of the total in the world.

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