Coin Cafe, a Brooklyn-based Cryptocurrency exchange company was ordered by Letitia James, the New York State Attorney General to pay back the users of the currency exchange company $4.3 million.
The currency exchange is charged for taking excessive fees from the Bitcoin-stored accounts which are not revealed to the users of the platform. Coin Cafe had previously applied for a license to practice virtual currency exchange back in July of 2015 at the State Department of Financial Services of New York, which was only sanctioned over seven years in January 2023.
According to Letitia James, the currency exchange had been apparently functioning for more than 7 years putting its account holders in jeopardy as the platform did not validate to register at the New York Attorney General’s Office which it was obligated to do.
AG Letitia James has further revealed that the currency exchange has practically drained out entire funds from some of its user’s accounts by charging excessive fees for holding Bitcoins, without informing them, and has scammed its users.
NY AG James Reveals Coin Cafe’s Fraud
On May 18, AG Letitia James, took to Twitter, stating how Coin Cafe has deceived its investors. She also stated that the company will now pay $4.3 back to its users for doing so. The Attorney General’s Office investigated the company’s actions and disclosed that from 2020 September, had four times altered its fee structure without properly informing its users.
The users were even charged fees for their inactivity on the platform over 30 days of 7.99% or Bitcoins worth $99 from their accounts. Coin Cafe is now expected to inform via mail to all its American users within May 23.
