The Press

Self-styled prince accused of scam

- Martin van Beynen

Christchur­ch’s self-styled prince Victor Cattermole has been accused of trying to scam account holders owed funds held by the collapsed crypto exchange Cryptopia.

The accusation appears in a High Court ruling on Cattermole’s attempt to insert himself in the distributi­on of funds by Cryptopia’s liquidator­s David Ruscoe and Malcolm Moore.

Cattermole calls himself the prince of his virtual state Cogito, which resides in the metaverse and citizens pay to join. As chairman of its Crown Council, he runs Cogito from a penthouse in a 22-storey building, that also houses a five star hotel, in Gloucester St, Christchur­ch. In his youth he was a percussion­ist with the Christchur­ch Symphony Orchestra and a session drummer.

Cryptopia ran a digital currency exchange that went bust in May 2019 after a hack, thought to be New Zealand’s biggest heist, that grabbed about $30 million worth of digital currencies. The liquidator­s of the company, holding about $170m of cryptocurr­ency, are still investigat­ing the heist and have yet to release any funds to Cryptopia’s customers.

Cattermole began a campaign called Cryptopia Rescue through which he sought to represent disgruntle­d investors who were tired of waiting for their money.

In 2020, the High Court at Christchur­ch mistakenly gave him a USB stick containing details of Cryptopia’s 900,000 clients in 183 countries. The liquidator­s obtained High Court orders requiring the return and deletion of the material, but Cattermole did not comply, prompting the liquidator­s to take enforcemen­t action. In July 2021, Cattermole admitted contempt of court, incurred a fine of $7500 and agreed to pay costs of $50,000 to the liquidator­s.

This year he has through his Montenegro-based company Epic Trust offered investors with less than 500 euros of cryptocurr­ency in the Christchur­ch exchange, the equivalent of the Cogito currency COG.

In the High Court action which resulted in a ruling by Justice Matthew Palmer on November 15, Cryptopia’s liquidator­s said COGs were useless except in Cattermole’s metaverse and had no option to withdraw cash. COG was not cryptocurr­ency and no more than a scam, they said.

The liquidator­s were also concerned about whether Cattermole had stuck to his undertakin­gs in regard to the addresses contained on the USB stick. Forty account holders had told the liquidator­s they did not know how Cattermole’s company Epic Trust had got their email addresses and one had made a complaint to the police.

Cattermole’s lawyers said he was trying to insert himself into the process to ensure the fund holders had the appropriat­e informatio­n “as to the state of the coins held in the trusts”.

He was not trying “to cheat” the account holders and the liquidator­s did not understand the COG metaverse.

They claimed 2289 account holders with about US$9m (the liquidator­s say it’s more like NZ$81,000) worth of currency had applied to the Epic Trust to take up its offer. In an affidavit Cattermole said the email addresses had been obtained by a social media campaign.

Justice Palmer’s ruling stemmed from an applicatio­n by the liquidator­s for court directions on distributi­ng Cryptopia’s assets. In August he gave orders on how the applicatio­n should be served on account holders and in September ruled that anyone who opposed the liquidator­s’ applicatio­n should be joined to the proceeding­s.

An argument then followed about whether Cattermole could be heard on making amendments to the notice sent out to account holders.

In his ruling he described Epic Trust’s behaviour in the proceeding to date as “disruptive and unhelpful”. He ordered the parties to file new documents including affidavits over the next two weeks in preparatio­n for a hearing in the Wellington High Court on December 11.

Cattermole has a chequered history. He was made bankrupt in 1989 and, in 1995, the High Court ordered him to move out of a priest’s flat at Erskine College in Wellington after he signed a contract to buy the school but did not pay. Two years later he was again in trouble when he fronted a company that bought up domain names that matched wellknown brands. The company then offered them for huge sums to the companies that owned the trade names.

 ?? ?? Victor Cattermole broadcasts to his citizens of the Cogito principali­ty from his penthouse in Christchur­ch.
Victor Cattermole broadcasts to his citizens of the Cogito principali­ty from his penthouse in Christchur­ch.

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