Ontario’s ‘Crypto King’ faces calls to repay millions in bankruptcy proceedings

• Crypto King Aiden Pleterski faced scrutiny for hiding income and causing investor losses in an ongoing bankruptcy case.
• A trustee sought to deny Pleterski’s discharge unless he repays millions, as Justice Black deliberated on the case.

During a hearing in Toronto, a lawyer for the trustee in Ontario’s “Crypto King” bankruptcy case accused Aiden Pleterski of showing no remorse for his role in operating a Ponzi scheme, per sources. 

The lawyer stated that Pleterski’s lack of cooperation has continued to cause financial difficulties for his investors.

New court records filed by the trustee alleged that Pleterski was hiding income from online gaming and other internet services. The records also highlighted Pleterski’s failure to account for millions of dollars worth of crypto. 

Leanne Williams, counsel for the trustee, expressed the trustee’s stance clearly, 

“Mr. Pleterski should be embarrassed and ashamed of his conduct, but he clearly is not, and this is precisely the reason he should not be granted a discharge.”

Unaccounted assets and missing funds

The trustee claimed that the 25-year-old Pleterski sold $430,000 worth of virtual weapons for online games and began managing OnlyFans creators for a profit share, activities he did not disclose to creditors.

This undisclosed income is expected to determine whether Ontario Superior Court Justice William Black will release Pleterski from bankruptcy.

During the hearing, it was noted that none of the funds from these activities were reported to creditors. Justice Black reserved his decision on the matter. 

Pleterski’s bankruptcy proceedings have involved tracking down substantial amounts of money, with creditors claiming up to $40 million.

However, only about $27 million in proven claims were admitted to the proceedings.

Proposed conditions for discharge

The trustee has requested that Pleterski be denied a discharge from bankruptcy or that any discharge be conditional on the repayment of more than $4.5 million in unaccounted assets and funds. 

Additionally, the trustee argued for Pleterski to repay approximately 30%, or around $9 million, of the money lost by more than 150 creditors.

Pleterski was not present at the hearing but submitted an affidavit expressing that such conditions would ensure he is punished for life for actions he described as “mostly immature” and without ill intent. 

Pleterski stated, 

“Essentially, they want me to remain an undischarged bankrupt for the rest of my life.”

Crypto King: A history of legal troubles

The case against Pleterski has been unfolding since the summer of 2022, when investors forced him into bankruptcy.

For nearly two years, investors have been trying to recover the money they entrusted to Pleterski for crypto and foreign exchange investments. 

Pleterski has been charged with fraud and money laundering following an 18-month investigation by Durham Regional Police and the Ontario Securities Commission.

Police allege that Pleterski promised massive profits and guaranteed no losses to investors, but failed to deliver, prompting many investors to report him to authorities.

The trustee’s investigation revealed that Pleterski invested less than two percent of the funds while spending nearly $16 million on personal luxuries, including private jets, vacations, luxury cars, and a lakefront mansion.

The outcome of the bankruptcy discharge hearing remains pending as Justice Black continues to deliberate on the conditions for Pleterski’s discharge.