Swiss Regulators Probe Crypto Mining Company Envion

The Swiss Financial Market Supervisory Authority (FINMA) has today announced enforcement proceedings against crypto mining firm Envion. The regulators believe that the German-Swiss start-up has been operating in breach of national banking laws.

Legal Proceedings Brought Against Fraudulent German-Swiss Crypto Firm Envion

Although largely welcoming to cryptocurrency businesses, Switzerland’s financial regulators are working hard to ensure that the domestic blockchain space is kept fraud-free.

They’re currently investigating Envion – a mining hardware firm that raised $100 million during their initial coin offering (ICO) last year. Envion stands accused of breaking banking laws by an “unauthorised acceptance of public funds”.

Envion is a German firm that relocated to Switzerland’s “Crypto Valley” to take advantage of the nation’s favourable digital currency legislation. It was started in Berlin last October with the stated goal of creating portable and more environmentally-friendly digital currency mining hardware.

However, local news source SwissInfo report that there has been considerable infighting amongst the team at Envion. In May, it’s believed that there was a disagreement between the company’s chief executive and founders. Both factions are accusing the other of using underhand tactics to enrich themselves.

According to reports, CEO and one time German TV journalist Matthias Woestmann stated that millions of additional tokens had been minted without many at the firm’s knowledge. These tokens were then sold for profits, prompting criminal investigation from FINMA.

However, there is more to the story than just fraudulently producing extra tokens. Woestmann is accused by the company’s founders of attempting to wrest control of the firm from them. This led to complaints being made to both the German authorities and FINMA. Understandably, investors were left unsure whether they would get their tokens from Envion.

This infighting has to lead to calls from the cryptocurrency community for investors to be refunded and the company dissolved. In response to a Medium post titled: “Envion CEO Faces Charges, Diverts Attention with Trumped up Counter Story”, one contributor stated simply:

“Give us all our money back immediately Envion, and dissolve the company.”

The financial watchdog has already come down hard upon some fraudulent cryptocurrency firms. Last year, FINMA shut down three such firms and investigated several more.

Featured image from Shutterstock.

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