A Welsh man was imprisoned for contempt of court after falsifying information about his cryptocurrency assets. Graham Darby, aged 50, was jailed for nearly five months at Parc prison in Bridgend for failing to disclose that he possessed 100 Bitcoin, valued at approximately £8 million. Darby, formerly of Swansea, faced legal action in the High Court initiated by another cryptocurrency trader, 22-year-old Australian Zi Wang. Wang accused Darby of breaching an agreement involving the exchange of cryptocurrencies. The court determined that Darby had misled the court about the worth of his Bitcoin holdings, resulting in an 18-month prison sentence that was ultimately reduced following his 146-day incarceration and subsequent apology for his actions.
Darby had entered into an arrangement with Wang to exchange 30 Bitcoin for 400,000 units of Tezos, another form of cryptocurrency, with an agreement to revert the transaction after two years. Wang asserted that Darby had failed to fulfil his end of the agreement, owing him between £900,000 and £1.3 million. Their professional relationship deteriorated when the value of Tezos surged, leading Darby to block Wang on the Telegram messaging app. In his defence, Darby claimed compliance with all obligations and stated that Wang had not benefitted as intended from the transaction. Expert evidence by cybercrime investigator Richard Sanders confirmed Darby’s ownership of the 100 Bitcoin, which he failed to disclose during court proceedings. Despite claiming a faulty memory and loss of password-protected wallets, Darby’s cryptocurrency holdings were verified.
Contempt of court proceedings ensued, alerting Darby to his entitlement to legal aid. He missed a hearing to determine his contempt, leading to an adverse ruling from Judge Keyser KC. When Darby eventually appeared at a subsequent hearing, he alleged attempts to secure legal representation. Nonetheless, Judge Keyser found Darby negligent in his legal obligations and imposed an initial jail term of 18 months, with a potential reduction for an apology and remedial actions. Darby experienced mental distress while imprisoned, prompting his daughter’s involvement in securing legal aid through Janes Solicitors. Following an apology and settlement with Wang, Darby’s sentence was revised to the time already served, amounting to 146 days.
In response to the outcome, Darby criticised the legal system, drawing parallels to the Post Office scandal. Lord Justice James Dingemans, who presided over the appeal, acknowledged Darby’s mental health challenges and the tardy engagement in the legal process. Dingemans advocated for fair treatment, citing the importance of legal representation in contempt cases. The judge’s decision to reduce Darby’s sentence highlighted the need for adherence to court orders and fairness in legal proceedings. Darby’s account of struggling with memory issues and the pressures of the judicial process influenced the judge’s leniency in the final ruling. Reflecting on his ordeal, Darby expressed disillusionment with the justice system and its perceived inadequacies in rectifying errors.
The case not only sheds light on the complexities of cryptocurrency transactions but also underscores the significance of transparency and compliance with legal obligations in financial dealings. Darby’s experience serves as a cautionary tale about the repercussions of withholding crucial information during legal proceedings. It highlights the challenges individuals may face in navigating legal intricacies, especially in high-stakes matters involving substantial assets like cryptocurrency. The legal system’s capacity for leniency in acknowledgement of extenuating circumstances underscores the need for equitable treatment and support for individuals entangled in legal disputes. Darby’s admission of fault and subsequent resolution with Wang emphasises the potential for amicable resolutions even in contentious legal battles, encouraging a re-evaluation of dispute resolution mechanisms in complex financial transactions.
By Conor Gogarty, Investigations Editor.