The former director of Australian crypto firm Blockchain Global has been temporarily banned from leaving the country amid a probe over his role in the firm’s collapse, which owes creditors $37 million (58 million Australian dollars.)
The Australian Securities and Investments Commission (ASIC) said on Feb. 28 that it secured an interim travel restraint order dated Feb. 20 from the Federal Court of Australia against Liang “Allan” Guo — the company’s director.
Guo — a Chinese citizen — must hand over any owned passports and is banned from leaving or trying to leave Australia until Aug. 20.
The order was made during a hearing in Guo’s absence, meaning he couldn’t immediately respond to the decision. Guo is next slated to appear before court on March 12.
“ASIC applied for the travel restraint orders over concerns that Mr Guo may leave the country while it continues its investigation,” the regulator said.
We have secured interim orders restraining Liang Guo, a former director of Blockchain Global, from leaving Australia. We are investigating Mr Guo and two other directors over the collapse of a #crypto-asset exchange operated by the company https://t.co/ZqojEQoLUK
— ASIC Media (@asicmedia) February 28, 2024
In the federal court judgment, Justice Button said the allegations against Guo “are very serious.”
According to ASIC, Blockchain Global operated the crypto exchange ACX Exchange between January 2016 and December 2019, with liquidators appointed to oversee the winding down of the exchange on Feb. 11, 2022.
The regulator alleged Guo transferred $1.69 million (2.6 million Australian dollars) from a bank account holding ACX Exchange investor funds to make personal investments.
ASIC further alleged that in 2019, Guo transferred 21.11 Bitcoin (BTC) — currently worth roughly $1.3 million — to a private wallet he controlled.
ASIC is also investigating Guo and Blockchain Global’s other directors Xue “Sam” Lee and Zijang “Ryan” Xu over alleged breaches of corporate law while operating the ACX crypto exchange.
Both Lee and Xu are believed to reside overseas. Justice Button said Guo “is the only person of interest who remains in Australia and his examination may improve the prospects of [...] recovering monies.”
ASIC — which started investigating the trio last month — anticipated their investigation would take around 12 months, according to the judgment.
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“It is not apparent why the investigation was commenced when it was, given when Blockchain Global failed, Justice Button said. “Nonetheless, the investigation is on foot, albeit in its early days.”
On Jan. 29, Lee was charged by the United States Securities and Exchange Commission for his involvement in a $1.7 billion crypto fraud scheme that operated under a series of projects the SEC dubbed “HyperFund.”
Lee, alongside his associated Brenda “Bitcoin Beautee” Chunga, was said to have promoted various membership packages to investors with false promises of guaranteed, high returns from crypto mining and other trending activities.
Lee is also facing charges from the U.S. Attorney for conspiracy to commit securities and wire fraud.
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Additional reporting by Jesse Coghlan.
