An investment company which advanced more than €500,000 to a brokerage to acquire and store cryptocurrency on its behalf has claimed before the High Court that the money may have been dissipated.
The claims were made by lawyers representing Colin Tobin Enterprises Limited, which secured a temporary High Court freezing order restraining the broker, Millcove Digital Solutions Limited, from disposing of the plaintiff’s cryptocurrency assets.
The interim injunction also prevents Millcove from reducing or diminishing the value of its assets within the State below a value of €211,000.
The injunction was granted on an ex-parte basis by Mr Justice Paul Burns during a vacation sitting of the High Court. The judge made the matter returnable to a date next week.
The plaintiff brought proceedings after the defendant’s alleged failure to cash in cryptocurrency held on its behalf and provide the funds to Colin Tobin Enterprises Ltd.
Represented by Garrett Flynn, the plaintiff company claims it provided funds to the defendant, which it is claimed was to act as a broker, to acquire and store various cryptocurrencies including Ripple, Luna Classic, Pancake and BNB Coin on the plaintiff’s behalf.
The plaintiff, whose sole shareholder and director is businessman Colin Tobin, believes that while his investment was in excess of €500,000 the cryptocurrency is currently valued at about €211,000.
In a sworn statement to the court in support of the High Court application Mr Tobin said he had no issue with the current value of the assets he purchased as he accepted the risk that came with buying cryptocurrency.
He said he had started acquiring cryptocurrency from the defendant firm in May 2021.
He claims that brothers James Nagle, who was the founder and chief executive of Millcove as well as being Mr Tobin’s principal point of contact, and Peter Nagle were directors and shareholders of the defendant.
Mr Tobin said he had a good relationship with James Nagle and regularly communicated with him regarding their business dealings.
However, he claims that following James Nagle’s tragic death in early April 2023 the defendant, with a registered address at Francis Street, Dublin 8, suspended its operations.
In and around that time, Mr Tobin says, he sought to convert some of his cryptocurrency stored by Millcove into funds so he could avail of an opportunity to purchase a commercial property in Co Cork.
While he has great sympathy for the Nagle family and has sought to address matters in a sensitive manner, he claims that Peter Nagle, who he alleges is a director and 40 per cent shareholder of Millcove, initially ignored Mr Tobin’s attempts to reach him.
However, he claims Mr Nagle eventually met him in mid-May.
Mr Tobin, from Ovens, Co Cork, claims Mr Nagle told him during that meeting that Millcove had difficulties in locating the cryptocurrency assets that had been kept on the plaintiff’s behalf. He claims Mr Nagle gave a “vague “account of the efforts being made to locate the assets.
Mr Tobin said Mr Nagle also promised to continue to try to locate the currency and said he would not ignore Mr Tobin’s texts and messages. Mr Tobin claims that since that meeting Mr Nagle has again ignored his communications.
Mr Tobin also said his firm’s demand to be repaid the €211,000 he believes his cryptocurrency is currently worth has also gone unanswered. He claims he should not have to wait indefinitely to be informed if the defendant does actually hold cryptocurrency on the plaintiff’s behalf.
He now fears that all the money his firm transferred to Millcove may have been misappropriated.
Mr Tobin added in his sworn statement there was a risk that if the cryptocurrency assets were not preserved or frozen then the defendant company may not have sufficient assets against which the plaintiff could execute any judgment.
Given the company had suspended and not resumed its operations, and had no immediate use of the sum sought, Mr Tobin said he should be informed of the location where the cryptocurrency is being stored.
He claims Millcove is failing to engage meaningfully with his company or assist the plaintiff in recovering the property he says is held on trust for it.
Mr Tobin also fears that there is a substantial risk that the defendant may take steps to prevent the plaintiff from recovering the cryptocurrency assets and has sought various orders including the freezing orders from the High Court.