Federal Judge Wavers As CFTC Seeks Injunction in Crypto Fraud Case

The Commodity Futures Trading Commission is wrapping up its case against CabbageTech owner and accused crypto-fraudster Patrick McDonnell - but the hearings in New York this week have been anything but simple.

The U.S. regulator is seeking a permanent injunction against McDonnell, who allegedly defrauded investors out of nearly $500,000, according to a lawsuit the CFTC filed in January.

While a ruling on the permanent injunction was anticipated on Wednesday in New York, U.S. District Judge Jack Weinstein for the Eastern District of New York pushed closing arguments to Thursday - largely due to the continued absence of McDonnell, who appeared in court Monday but did not on either subsequent day.

Weinstein further noted that McDonnell could object to the case against him based on the burden of proof.

McDonnell hasn't been present since he lost a bid to have the suit dismissed on jurisdictional grounds.

Rather than having him testify, the CFTC showed clips of a video deposition recorded last month in connection with the case.

On Monday, Weinstein told McDonnell to "Make a motion that the burden of proof is beyond a reasonable doubt because of the nature of the charges and the fact that this evidence will be used against you should you be prosecuted for a crime based on these facts alleged and that the evidence that you are forced to give in order to defend yourself will be denied."

Weinstein indicated on Wednesday that he wants to give McDonnell yet another chance to argue in his own defense.

He told the lawyers representing the CFTC to ensure McDonnell knows he is welcome to appear in court on Thursday to make a closing argument as well as the possible motion to dismiss.

In a letter to the court on Wednesday, he wrote that "My life is being lived hand-to-pocket sir with [this] case leaving me financially destitute with all debtors extended beyond extension."