Joshua Garza, the cryptocurrency entrepreneur who previously led GAW Miners, faces a significant legal setback after failing to respond to federal regulators. Kathleen Shields, an SEC prosecutor, has
Joshua Garza, the cryptocurrency entrepreneur who previously led GAW Miners, faces a significant legal setback after failing to respond to federal regulators. Kathleen Shields, an SEC prosecutor, has requested a default judgment following the defendants' silence on a complaint filed by the Securities and Exchange Commission in early December.
The filing came after both GAW Miners LLC and ZenMiners LLC ignored service documents delivered on December 4th. Federal authorities had originally allocated the companies until December 25th to provide answers, then granted an additional three days to accommodate the holiday. By January 6th, neither entity had submitted any response.
According to the agency's court filing: "On December 1, 2015, the Commission filed its Complaint in this action. On December 4, 2015, a package containing the Summons and Complaint were served upon defendants GAW Miners, LLC and ZenMiner, LLC (d/b/a Zen Cloud) by serving their registered agents of record, VCorp Services, LLC. On December 9, 2015, the executed returns of service for both GAW Miners and ZenMiner were filed with the Court. The Court's public docket indicates that the deadline for both GAW Miners and ZenMiner to answer or otherwise respond to the Complaint was December 25, 2015. Because that day was a holiday, their time to answer or otherwise respond was extended to December 28, 2015, by operation of Federal Rules of Civil Procedure 12(a) and 6(a)(1)(C). 5. To the best of my knowledge, and as reflected on the Court's public docket for this action, neither GAW Miners nor ZenMiner has filed an answer or otherwise responded to the Complaint as of today."
Coindesk initially broke the news and distributed the complaint document publicly. While Garza appears as a named defendant, his name notably does not surface in the complaint itself—a peculiarity observers have noted. His attorney, Marjorie J. Peerce, continues in his representation but refused to discuss the proceedings.
Failing to mount a defense will likely damage Garza's position considerably once he appears before the court. Some had speculated he may have departed the country during the final phases of the matter, though the SEC's initial filing suggests he resides in Brattleboro, Vermont. This small municipality, home to roughly 12,000 residents, formerly housed GAW-wireless, another enterprise linked to Garza. That internet venture now faces its own regulatory examination.
Garza has maintained he distanced himself from GAW-wireless in 2012, yet ownership today remains unclear, according to local reports. When contacted, SEC officials declined to confirm whether Garza remains within the United States, a customary position when litigation remains active.
The allegations include two counts of fraudulent securities offerings and one count involving unregistered securities sales.
