‘Crypto King’ associate was operating his own Ponzi scheme

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An associate of Ontario’s self-proclaimed crypto king was operating his own scam alongside the multi-million dollar Ponzi scheme, according to court documents.

Colin Murphy, 26, is charged with operating a Ponzi scheme in a Ponzi scheme after an Oshawa, Ontario. resident filed a civil lawsuit against him in December to recover $270,000 in investments.

Murphy reportedly worked with Aiden Pleterski, who owes investors at least $35 million.

Under bankruptcy proceedings, Pleterski used Murphy to raise money for his cryptocurrency and currency trading company.

What is alleged is that Murphy ran his own investment program alongside what Pleterski operated, Norman Groot, a fraud recovery lawyer representing the investor, told CTV News Toronto.

WHAT HAPPENED?

Beginning in June 2021, the Groots client said he began transferring money to Murphy for Pleterski to invest, which Murphy said grew to $878,444.60 at his peak, according to a notice of action filed in December.

At first, Murphy showed the investor his Porsche and Lamborghini as proof of his returns on investments, which he made through Pleterskis’ transactions, the legal notice says. Largely through word of mouth, Pleterski earned a reputation for the large returns he earned on his investments.

Murphy also stored crates of cash at his grandfather’s house, which he said were stored returns for other investors, according to legal documents.

After almost a year of investing with Murphy, Groots’ client wanted to cash in. In WhatsApp messages included in an affidavit, the investor told Murphy that the money he transferred was his life savings.

At that time, Murphy began to scale back his communications with the investor, the documents show.

Colin Murphy takes a photo at Upper Canada Mall in Newmarket, Ontario. (Instagram).

In texts included in the affidavit, Pleterski messaged the investor in June 2022: Colin received money from so many people that I never got to see. Colin has over 2 million assets that he can liquidate but he doesn’t.

Court documents allege there is no evidence that investor funds were ever transferred to Pleterski. Murphy had engaged in investor fraud — parallel to but separate from the Pleterski Ponzi scheme, a notice of action says.

Murphy’s attorney, Sukanta Saha, said it would be inappropriate for his client to speak with CTV News Toronto because the matter is before the court, but Murphy denies all the allegations that have been made.

My client, Mr. Murphy, considers himself as much a victim of Mr. Pleterski’s misdeeds as anyone else and that will be demonstrated in the strong defense that will be presented by Mr. Murphy in due course.

Pleterskis’ attorney did not respond to inquiries from CTV News Toronto, but previously said his client disputed much of what was alleged in court and called the investors’ financial claims grossly exaggerated.

A LUXURIOUS LIFESTYLE

An Ontario Superior Court froze Murphy’s assets in September 2022, after a separate investor made similar allegations to Groots’ client.

Murphy’s social media posts, which are recounted in court documents, continued to depict a lavish lifestyle driving a Lamborghini in Las Vegas, speeding to 250 km/h in a Mercedes Benz on unpaved roads. plowed, posing on a jet ski in Nassau and firing a handgun at a shooting range in Orono, Ontario.

Yet Murphy simultaneously told the investor he had no funds to repay them, a fact inconsistent with his lifestyle, according to legal documents.

Clearly there are assets that are not being accounted for, Groot said.

Colin Murphy driving a Lamborghini Huracan on October 4, 2022 (Instagram).

The next process available to attempt to preserve assets and attempt to preserve evidence, especially in the form of data, is to seek a private search order.

Groot obtained a civil search warrant from Judge HK OConnell on January 12, 2023 for the residence where Murphy was staying in Whitby, Ont., according to court documents.

Investigators executed the warrant a few days later and found that Murphy had refused to return an iPhone 13. Digital forensics experts concluded that he had deleted data from the device, which he later justified as resetting the phone because it contained intimate photos.

As a result, Murphy was found in contempt of court, a topic that will be addressed in an upcoming sentencing. He was also ordered to hand over financial records dating back to 2020, including money received and transferred to Pleterski.

As the case progresses, Groot said he is working to preserve all data and assets he can trace while connecting with other investors involved. Anyone who has dealt with Murphy, we’re definitely interested in hearing about him, Groot said.

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