Vandalism and extortion claimed in bitcoin ATM … – SiliconANGLE – SiliconANGLE (blog)

Bitcoin is considered by some to be nothing more than the virtual currency of choice for drug dealers and other nefarious actors. But a strange case out of the U.S. Midwest shows that bitcoin-related crime can occur in the offline world as well.

In a complaint filed in the Northern Illinois District Court, bitcoin automatic teller machine provider Bitcoin of America (SandP Solutions Inc.) alleges that a rival firm is smashing up its bitcoin ATMs to eradicate competition.

Named in the filing are Andrew Konja, Alvin Konja, Odai Mabrouk and other unknown defendants and co-conspirators. Andrew Konja is said to be the owner of Bitexpress and related entity MT Group, a Philadelphia-based bitcoin ATM provider.

The complaint alleges that the accused hired goons to smash — not virtually, but with real hammers — 70 bitcoin ATMs including 20 of those owned by Bitcoin of America over a nine-month period in Chicago and Detroit.

In addition, the lawsuit claims that a number of bitcoin ATM owners have been threatened with violence. In one incident, it’s alleged that “one of the Defendants, acting alone or in concert with others, told a competitor that he would be shot in the head if he continued to operate bitcoin ATMs in the Detroit metropolitan area.”

Other owners are alleged to have been asked for a ransom payment in bitcoin in return for their ATMs not being smashed. The suit said the plaintiff was aware of one bitcoin operator paying the defendants a bitcoin payment as insurance against further vandalism. Bitcoin of America claims that the shakedown was coordinated using “sites that automatically destroy posted messages after the passage of time,” making it hard for authorities to take action.

The suit alleges that the defendants have violated the Racketeer Influenced and Corrupt Organizations Act, or RICO. Bitcoin of America demands three times the cost of the damages, plus court and attorney fees, a figure believed to be roughly $600,000 excluding legal costs.

Image credit: sfupamr/Flickr/CC by 2.0

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