
Mark Karpeles Gets Suspended Jail Term - T-A
https://www.bloomberg.com/news/articles/2019-03-15/former-bitcoin-baron-mark-karpeles-gets-suspended-jail-term
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MotiveMe
As someone that still has Bitcoin tied up in the Gox civil rehabilitation
suit, I feel justice is adequately served here.

Karpeles was clearly in over his head, and made terrible decisions after the
hacking, but I don’t believe imprisonment would serve any meaningful purpose,
and I do believe he feels genuine remorse for his actions.

~~~
ckastner
> _but I don’t believe imprisonment would serve any meaningful purpose_

Sure it would! It would serve as a deterrent. Some people shouldn't be
handling hundreds of millions of USD.

Karpeles' operation wasn't just unprofessional finance, it was a complete
shit-show. The court should have sent the message to others to not attempt
something as complicated and risk-laden as operating a financial exchange
without even the slightest bit of know-how necessary to do that.

Startup culture can be great, but it's amazingly dangerous when operating
certain trades or industries.

~~~
joecool1029
> Sure it would! It would serve as a deterrent. Some people shouldn't be
> handling hundreds of millions of USD.

I don't think Mark ever expected to handle that kind of money. It just sort of
happened. One of the things usually needed to prove a crime was committed was
that there was the intent to commit it.

> Startup culture can be great, but it's amazingly dangerous when operating
> certain trades or industries.

Mark's about the furthest thing from a startup bro. Honestly, I got the vibe
he started MtGox as a hobby that happened to make money. A lot of it doesn't
make sense from a business planning standpoint. Bet you didn't know the parent
company of MtGox was named after his cat and served as a hosting company and
domain registrar. He's a gentoo nerd that had a pet project win the lottery.
There's far more to question about what the exchange had happen before he took
it over, but I suppose jed won't talk about that.

To be fair though the year he spent in jail probably added some years to his
life. While I doubt it was great for his mental health, it did wonders for
getting his weight under control.

~~~
ckastner
> _I don 't think Mark ever expected to handle that kind of money. It just
> sort of happened._

That is probably true, and I wouldn't expect anyone to stand in the way of
something that they had created and that developed such a momentum. How could
one!

What I _would_ expect, however, is (1) that person to recognize this momentum,
(2) to recognize that this momentum is way above the person's head, and (3) to
rent or hire the know-how necessary to deal with this.

IT Security consultants, legal experts, people with experience in running
exchange systems, etc.

> _One of the things usually needed to prove a crime was committed was that
> there was the intent to commit it._

There's no question of that, as the court found that he had tampered with
accounts and manipulated records to hide losses.

~~~
lovemenot
I actually met Mark once, on the very day that it was reported here on HN that
Mt. Gox had been breached. This was a couple of years before the melt-down.

I had read the story here and, having just a little experience of Financial
systems (nowhere near enough) I offered to help.

Mark took my meeting on that day because, in retrospect, he was likely looking
for a Hail Mary. Perhaps hoping for a ransom demand.

He was at least smart enough to know I wasn't it. Nevertheless, if there had
been good options, as you seem to suppose, I very much doubt he'd have taken
my meeting.

Mark was in over his head, even then. And that tsunami just kept on rolling
in. I wish him well.

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zubairq
Having lost over 350 Bitcoins myself, I would say this is a fair verdict. Mark
Karpeles was in over his head, that is true, but so are most people in
startups or companies that end up hurting people or losing their money. If we
were to start jailing people who lost other people's money then 95% of all
people who take investment would be in jail.

~~~
pakitan
So, if you buy bank shares today and it turns out the bank has been insolvent
for 2 years already and management was hiding this from investors, this is
totally fine, as long it's not an established bank but a "startup" bank, am I
understanding you correctly?

Mark was in way over his head but nobody says he should be jailed for being in
way over his head. He should be jailed for defrauding people. He cooked the
books and he hid the fact that MtGox was insolvent practically from the moment
he bought it.

~~~
smokeyj
Comparing Magic The Gathering Online Exchange to an FDIC regulated bank.. He
was running the equivalent of a fraudulent trading card ring that happened to
become very valuable.

Mark has some of my coins and I think he's done enough time. Prison in general
is cruel and unusual for anything besides violent offenders.

~~~
bdcravens
When Mark started running it it was a Bitcoin exchange. Everyone banters about
the origins of the name, but all they really did was reuse a domain name.

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tomc1985
I used to buy M:TG cards at Mt.Gox back in the day. It was really confusing
when I heard they were now a bitcoin exchange

~~~
miles
To those saying you could not have traded cards on Mt. Gox:

" _sometime around late 2007, the service went live for approximately three
months before McCaleb moved on to other projects_ "
[https://en.wikipedia.org/wiki/Mt._Gox#Founding_(2006-10)](https://en.wikipedia.org/wiki/Mt._Gox#Founding_\(2006-10\))

Gwern: _" we know the mtgox.com domain had a landing page discussing a
forthcoming Magic card trading site (because a 2007 page is in the Internet
Archive), but we can't find any evidence that there was any actual trading
going on. Did anyone ever actually trade card for card or money for card on
Mtgox.com?"_ McCaleb: _" yeah they did"_
[https://www.gwern.net/docs/bitcoin/2014-mccaleb](https://www.gwern.net/docs/bitcoin/2014-mccaleb)

~~~
tomc1985
Indeed. archive.org isn't helping jog my memory but I was buying cards around
2005-2010 from a number of sites, including Mt.Gox.

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jron
Great interview with Mark about the start and demise of MtGox:
[https://www.youtube.com/watch?v=7cUBFXf678o](https://www.youtube.com/watch?v=7cUBFXf678o)

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j-c-hewitt
Someone should put together a crash weight loss program that simulates being
convicted in the Japanese criminal justice system modeled on this.

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jaequery
There have been other exchanges getting hacked after him. How come none of
them get jailed time and only Mark?

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kabwj
So he’s home free? If I were him, I’d be afraid that someone might want to
physically harm me.

~~~
Mengkudulangsat
He is, all the time, which he shared on his Reddit AMA some time ago.

Might be worse than the actual sentence.

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topmonk
A happy result for all involved. Karpeles was appropriately punished and all
investors are being made whole. Most bankruptcies don't end that way.

~~~
jasonzemos
I'm still out plenty of money thanks to Karpeles that I'll never see again.
Not a happy result for me, sorry, no.

~~~
inuhj
Same, not counting the money I lost due to his scam trading bot that was front
running the market. I think 5 years would be a light sentence here.

~~~
icebraining
I'm out of the loop, why do you say he was front-running the market?

EDIT: I found
[https://twitter.com/grace_za/status/1016688636304265216](https://twitter.com/grace_za/status/1016688636304265216)

