The Alberta Securities Commission (ASC) has issued a Notice of Hearing against CatalX CTS Ltd. (operating as Catalyx), its then chief executive officer Hyuek Jae Park and its then chief financial officer Jae Ho Lee, alleging breaches of Alberta securities laws. The allegations include that Lee perpetrated a fraud on clients and that Catalyx failed to comply with a written undertaking that allowed it to continue operating in Canada while its application to register as an authorized crypto asset trading platform was under review. The Notice of Hearing alleges that, beginning in February 2019, Lee improperly withdrew at least CAD 14,030,000 worth of clients’ crypto assets from the platform and transferred them to accounts he controlled at other crypto trading platforms, later returning some assets but leaving a substantial shortfall. It also alleges misappropriation of clients’ fiat currency deposits for unauthorized purposes. The ASC further alleges Catalyx did not promptly report a material breach of the undertaking after Park became aware of the fraud by 24 November 2023, and that Catalyx failed to establish and apply adequate policies and procedures to mitigate the risk of employee misappropriation of client assets intended to be held in trust. An appearance to set a hearing date is scheduled for 15 September 2025. The ASC noted assistance from the British Columbia Securities Commission, the Financial Transactions and Reports Analysis Centre of Canada (FINTRAC), and the Financial Market Authority Liechtenstein.

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