Jennifer Robertson met Bitcoin entrepreneur Gerald Cotten while working as a waitress in 2014. Robertson was going through a messy divorce when she met Cotten, and he swept her off her feet. Their whirlwind romance and marriage ended suddenly in 2018 when Cotten died while on their honeymoon in India. It seems like a typical sad love story, but it is more mysterious than that because Cotten died owing C$250 million to clients of his cryptocurrency exchange.
Cotten founded Quadriga Fintech Solutions in November 2013 with Michael Patryn; the latter was later revealed to be Omar Dhanani, who served 18-months in Federal prison on identity theft charges. Quadriga launched its online exchange a month later, focusing on local trades. Records show only C$7.4 million worth of Bitcoin was traded throughout 2014. However, Cotten had much grander plans because he envisaged people from as far and wide as Alabama betting legally online, trading on the price fluctuations of Bitcoin and other cryptocurrencies.
Cotten Left Solely in Charge
Licensed under CC BY-SA 2.0
All Quadriga directors resigned in 2016, leaving Cotten as the sole person in charge. The company had no employees other than a few contractors, no official offices, or bank accounts. Bitcoin’s prize went crazy in 2017, increasing from US$1,000 to almost US$20,000. This surge resulted in nearly C$1.2 billion worth of Bitcoin traded on Quadriga, resulting in cash-flow problems because the company relied on third-party payment processors. In June of that year, Quadriga announced it lost US$14 million worth of Ethereum due to a small contract error.
Everything began unraveling in 2018. First, a Bitcoin price crash saw Quadriga customers report delays when withdrawing their funds. The Canadian Imperial Bank of Commerce froze the accounts of Costodian, one of Quadriga’s payment processors, which had C$28 million in. The bank said it could not determine who the money belonged to and that neither Costodian nor Quadriga could access the funds.
Cotten and Robertson got married while all this was going on and headed off to India for their honeymoon. However, before jetting off to India, Cotten made a new will that left his entire C$9.6 million estate to his new wife. This included real estate in Nova Scotia, British Columbia, and Kelowna, an airplane, sailboat, Lexus, and even a C$100,000 trust fund for Robertson’s dogs. Cotten died 12 days later following complications from Crohn’s disease. The hospital where Cotten allegedly died issued a death certificate and a no objection certificate” from the police to return Cotten’s body back to Nova Scotia.
The Quadriga owner’s death was kept secret for another month until it was made public on January 14, 2019. The exchange was placed in maintenance mode and continued accepting deposits for another fortnight.
C$250 Million Worth of Missing Funds
Robertson filed an affidavit on behalf of the company, which stated Quadriga had 363,000 registered customers, and it owed C$250 million to 115,000 of those customers. She claimed most of the funds were cryptocurrency held in Quadriga’s cold wallet on the laptop only Cotten had access to. Earnest & Young investigated the matter and found five Quadriga cold wallet addresses, but they had all been empty since April 2018. Further investigations found an additional three empty wallets and 14 trading accounts used to trade on other platforms.
Many people, including those affected by the missing C$250 million, believe Cotten faked his death and made off with the funds. The court-appointed law firm that is representing those affected sent a letter to the Royal Canadian Mounted Police asking for Cotten’s body to be exhumed to confirm both its identity and verify a cause of death. Nothing has yet happened on this front.
Robertson has since written a book, Bitcoin Widow: Love, Betrayal and the Missing Millions, which details her romance with Cotten and Quaadriga’s collapse. In her book, Robertson reveals she has received death threats from former customers who are owed money. She paints a picture of a loving man but one whose shady past came to light as people dug into his history.
“The simple fact is that Gerry should never have been in a position to hold all the levers of a billion-dollar company with no internal or external oversight,” Robertson wrote. “I know that now. I didn’t know it then. I didn’t believe I needed to.”
Robertson reveals how she has since learned Cotten used customer funds to pay for their lavish lifestyle. She is also adamant that her late husband did die in India, but did he really?
Image: Licensed under CC BY-SA 2.0