Feds Say Bitcoin Miner Maker Butterfly Labs Ran ‘Systematic Deception’
The Federal Trade Commission has filed a civil lawsuit against Butterfly Labs (BFL), an embattled Kansas-based Bitcoin miner manufacturer. The FTC alleges that the company engaged in fraudulent and deceptive practices.
Federal authorities believe that the three named members of the company’s board of directors—Jody Drake (aka Darla Drake), Nasser Ghoseiri, and Sonny Vleisides—spent millions of dollars of corporate revenue on all kinds of things, including saunas and guns, while ignoring many customer orders that went unfulfilled or were significantly delayed.
The case was filed in federal court last week in Missouri and unsealed late Monday, and it comes over a year after Ars first reported on the company and began testing its initial round of specialized computers designed to do nothing but mine for Bitcoin.