Migom Bank once billed itself as the outlier that could blend crypto‑friendly liquidity with Swiss‑style discretion. Exchanges and OTC desks, weary of hearing “no” from risk‑averse majors, moved millions into Roseau, Dominica’s capital, trusting both the tiny nation’s flexible regulatory framework and Migom’s multilingual sales pitch. That optimism collapsed on 29 February 2024, when the Financial Services Unit ordered the bank to “cease business and removed director Thomas Adrian Schätti”. A month later the High Court confirmed statutory administration.
Hope returned in August 2024, when the administrator filed a 153‑page cover letter, backed by more than 14,000 pages of exhibits, mapping where the missing money went and, crucially, how it might be clawed back.
Although a class-action complaint was initially lodged in New York on 30 August 2024 based on this evidence, plaintiffs have since withdrawn that filing. They are preparing to re‑file in the near future with new and far-reaching causes of action, leveraging information gleaned from the administrator.
Inside the administrator’s dossier
The investigation, led by a veteran UK barrister and a team of forensic accountants, portrays Schätti as the architect of an elaborate siphon. Over several years, he funneled customer balances, regulatory capital, and even payroll‑tax withholdings into a web of quietly controlled firms in Luxembourg, Austria, Ghana, the UAE, Canada, and the United States. None of those transfers carried board approval or regulator sign‑off, prompting the administrator to brand the conduct theft and embezzlement. Two long‑time lieutenants – Juergen Blaha and Gregory Donahue (a.k.a. Greg Mancuso) are listed as accomplices who “aided and abetted” the outflows.
The richest seam of evidence lies in the Baltics. Roughly €21 million was traced to Latvia, where Schätti and associates used Migom funds to buy a stake in Baltic International Bank SE, a lender whose own license was yanked on 10 March 2023 for endemic AML breaches. Another €5 million sits in Lithuania, frozen since the Bank of Lithuania revoked Transactive Systems UAB’s e‑money permit on 1 June 2023. Smaller caches appear in Dubai, Vienna, Accra, Montreal, and New York, all parked with subsidiaries carrying the Migom name. The trial’s breadth explains why the administrator urges criminal‑level cooperation and restraint orders in every venue.
Regulators in Roseau have moved quickly. The cease‑and‑desist was followed by mutual‑legal‑assistance requests that now span Europe and North America. Court petitions in Manhattan had quoted the administrator verbatim while accusing Migom executives of wire fraud and securities violations; those allegations are expected to be reasserted and broadened when plaintiffs re‑file.
Companion filings in Riga and Vilnius seek to convert findings into account freezes. Financial press coverage has kept the pressure on, from a “final chapter” analysis in November 2024 to deep‑dive features in many media outlets. Together, they have framed the saga as a test case for cross‑border crypto banking.
Why the liquidation phase matters for crypto businesses
For the exchanges that banked with Migom to escape mainstream rejection, the coming liquidation is existential. Many routed payroll, listing fees, and treasury funds through Dominica precisely because legacy banks froze them out. A well‑run recovery will return that capital and prove niche jurisdictions can still deliver rule‑of‑law outcomes. If the process drags, critics will call the affair a cautionary tale about “crypto‑friendly” banks. Insolvency lawyers say success hinges on appointing a liquidator with genuine cross‑border muscle (Big‑Four pedigree plus Baltic‑court credibility) to corral scattered assets and satisfy competing creditor classes.
The High Court is expected to choose that liquidator within weeks; two London restructuring outfits and a Toronto practice sit on the short‑list. Creditors will then receive public notice and a ninety‑day window to lodge proofs of claim, with customers who have already filed refreshed KYC packs at the head of the queue. Early priorities include recognition orders in Latvia and Lithuania, Chapter 15 discovery motions in the United States, and a call on whether to sell the Baltic International Bank stake now or wait for a better market. Interim distributions could begin once core assets are secured, with a final dividend after litigation and sales conclude – optimistically within twelve to eighteen months.
A cautious but genuine optimism
Migom’s depositors are not out of the woods yet, but they finally have a compass. For more than a year, the burning question has been whether any cash survived; investigators now confirm that sizeable sums are already under restraint orders. The pivot from speculation to documented fact and from administrative limbo to coordinated prosecution marks a genuine turning point.
If foreign courts honor Dominica’s requests and an experienced liquidator runs a transparent process, 2025 could be the year Migom’s long‑suffering customers see their balances again. It will not erase the frustration, but it would vindicate the principle that determined supervision and aggressive enforcement can still deliver justice in the unruly borderland where crypto meets banking.
Featured image via Shutterstock
