A US judge has ruled that the bitcoin companies that operated the largest Bitcoin ATM network in the US will be forced to pay back $14 million to a bitcoin ATM user who lost control of his money after an attack.
The judgement in a federal court in San Francisco on Monday also ruled that Bitcoin ATM operator Coinstar must compensate a former customer of the company.
In addition, Coinstar is required to pay $2 million in restitution.
The judge’s ruling in favor of the former customer comes amid a global crackdown on the digital currency.
Coinstar’s US operations have been hit with lawsuits and criminal investigations over the past year.
In May, CoinStar and its former chief executive officer Matthew Mays resigned after a federal grand jury indicted them for allegedly failing to report suspicious activity to regulators.
CoinStar’s former chief financial officer, Scott J. Osterman, was also indicted on charges of fraud and conspiracy.
Oesterman has pleaded not guilty.
CoinStars biggest US customer, former Bitcoin ATM user Joshua Lee, sued Coinstar in February, saying the company’s security systems failed to prevent the ATM operator from losing control of more than $30 million worth of his bitcoin.
Coin Star responded by filing a counterclaim against Lee, accusing him of theft.
Osters lawyers also filed a countercharge in the San Francisco court, arguing that Lee’s claim is frivolous.
A court order in that case is set to be handed down this week.
Coinstars new chief executive, Steve Jaffe, was previously the chief financial services officer at Coinbase, the biggest bitcoin exchange in the United States.
Coinstarr CEO, John Gebbia, also previously worked at Coinbase.
He is now CEO of Coinstarp.
CoinStarr, which was founded in July, is now a subsidiary of Coinstar.
Coin Starr has said that its new chief financial executive will oversee the company, and that the firm will have no role in the investigation.
Coinsts new chief legal officer, Brian M. McBride, also worked at Coinstar, but he is now Coinstars new chief technology officer.
Coinsta and Coinstar declined to comment.
Bitcoin ATM operators in the past have come under scrutiny for not adequately protecting customers from cyber attacks.
Coinstra, which operates in the UK, has been targeted by hackers who stole customer data and leaked it to the press.
CoinSTRA is also accused of not securing its network from attack.
CoinSTAR said in a statement that it is “very pleased with the outcome of this case and look forward to continuing to work with the government to bring this matter to a speedy conclusion.”
Coinstar said that it will now seek the full recovery of its customers’ funds and will continue to pursue all necessary legal remedies in the case.
Coinstras main US customer was Mark Lichtman, who lost nearly $30,000 in the attack.
Lichtmen account at CoinSTARBASE.com was hacked and was stolen by hackers.
Coin STARBASE is a US-based Bitcoin ATM company.
CoinSTRAS ATMs are often located in downtown San Francisco.