In this case, Pelling J was prepared to grant permission to serve a BTO against both Binance companies, including the administrator of the cryptocurrency exchange incorporated in the Cayman Islands.Īs one of few authorities on service of a BTO against a cryptocurrency exchange out of jurisdiction this will be a welcome decision to potential claimants – particularly given the inherent cross jurisdictional nature of cryptocurrency fraud. However, there are conflicting authorities as to whether the English courts have jurisdiction to make a BTO against a party outside the jurisdiction. It is well established law that NPOs cannot be served out of jurisdiction by the English courts and therefore in this instance an NPO was only awarded against the English Binance entity responsible for managing the applicants' accounts. more broadly, certain documents or information – typically to identify the proper defendant or gather sufficient information to particularise a claim (NPO).confidential documents from the potential defendant's bank (usually) to assist a proprietary claim to trace assets (BTO) or.Relief against BinanceīTOs and NPOs are both third party disclosure orders available in limited circumstances where an applicant seeks disclosure of:
Fetch crypto full#
''those who have received assets … without having paid the full price for them'' Īnd he limited proprietary relief limited to '' those assets which the third category of persons unknown either knew, or ought reasonably to have known, belong to the claimant or did not belong to them.'' 2.“those who were involved in the fraud''.Particular concern was the potential for the WFO to capture individuals within this category '' who, at least potentially, were innocent in the sense of not knowing or having reason to believe, or reasonable grounds to believe, that assets belonging to the claimant had been credited to their account''.Ĭonsequently, Pelling J therefore divided ''Persons Unknown'' into three classes:
The applicants' formulation of this category of respondent was considered '' too wide ranging'' by Pelling J. However, it is worth noting that the claimants only had to demonstrate, and the court found, that there was a '' good arguable case'' on each of the issues below. It was a broad ranging decision, the key elements of which are discussed below. permission to serve the proceedings out of the jurisdiction and by alternative means.a BTO and a Norwich Pharmacal Order (NPO) against the Binance entities to assist the claimants to trace the assets.a proprietary injunction, worldwide freezing order (WFO) and ancillary information disclosure against ''Persons Unknown'' (as discussed below) primarily to either freeze the assets moved from the accounts or restrain third parties from dealing with the traceable proceeds.The claimants applied to the English court for remedy seeking the following forms of relief in support of a claim for breach of confidence, an equitable proprietary claim and a claim in unjust enrichment: In this case, unknown fraudsters traded $2.6 million of the claimants' cryptocurrency to an anonymous third party buyer without permission. It is well known that the anonymity and accessibility of the internet can be a double-edged sword, creating opportunities for investors and fraudsters alike. In Fetch, the Court granted wide ranging remedies to the applicants, two ''Fetch.ai'' companies, against (1) unidentified fraudsters who had accessed and transferred funds from their cryptocurrency accounts, (2) two Binance entities, who managed the accounts and exchange, and (3) the recipients, innocent or otherwise, of the misappropriated cryptocurrency. A BTO is a type of third party disclosure order, potentially available in claims for fraud where a claimant seeks confidential documents (usually) from a bank to support a proprietary claim to trace assets.
Bankers Trust Orders ( BTOs) in particular are a powerful tool in a claimant's search for the perpetrators of cryptocurrency fraud internationally. Fetch.ai Ltd and another v Persons Unknown and others EWHC 2254 (Comm) (15 July 2021)įunds have disappeared from cryptocurrency accounts, but where to, and who can be sued? This decision shows the English courts' willingness to assist claimants seeking to obtain information to particularise claims for misappropriated funds.
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