Mawson Infrastructure Group has been dragged to the bankruptcy Court by a long list of creditors. According to the details, the company, famous for building centers for Bitcoin miners and artificial intelligence (AI) is now on the wrong side of its creditors. The report revealed that its creditors, including W Capital Advisors and Marshall Investments, have filed a bankruptcy petition against the firm due to its cash reserves falling under $6 million.
According to the filing, the creditors claimed the mining firm owes creditors more than $8 million. The creditors submitted the petition on Wednesday, asking the court to force the company into bankruptcy in the face of rising debts. The company’s stock also plummeted 54%, after confusion over whether it has filed for bankruptcy. However, Mawson, in a statement, denied filing for bankruptcy, saying its day-to-day activities are still going on normally.
Mawson makes allegations amid ongoing investigations
The current issue between Mawson and W Capital is bigger than the debts the former owes. The mining firm accused W Capital Advisors of its questionable relationship with James Manning, a former executive and board member that the firm let go. Mawson said the involvement of Manning raises so many ethical concerns. This is because W Capital is a trustee of W Capital Advisors Fund, the creditor pursuing the bankruptcy case.
Meanwhile, Mawson said its audit team is looking into the relationship between Manning and W Capital and other companies. The allegations include interference in operations and self-dealing, cranking the legal case up a little. Manning has also been fingered for his dealings with Vertua, facing accusations of breaching contracts. The company, Vertua Properties Inc., is also alleged to have interfered in Mawson’s business relationship.
According to Mawson, it has a case against Vertua, filing it at the Court of Common Pleas in Pennsylvania. In its filing, it accused Vertua, the landlord of its property of canceling its lease illegally. Mawson claimed that by canceling the lease on its Sharon PA property, Vertua breached their lease agreement and disrupted their business operations.
Mawson wants the court to order the reinstatement of the lease, and ask Vertua to reimburse its litigation costs. The company claimed that the Chapter 11 Bankruptcy petition was part of a larger strategy to hit the company during the court proceedings. However, it notes that it is prepared to defend itself and fight against all the charges.