Paramount Management Group, an ATM company, has officially shut down and laid off all staff, according to a report by The Philadelphia Inquirer. This is following a long legal battle with investors who claimed that Paramount failed to pay them more than $65 million in ATM fees.
Daryl Heller, owner of Paramount Management Group, appeared in court earlier in December and was asked to explain why he had not paid out $138 million that had been ordered by a judge to 2,700 investors. Heller invoked the 5th Amendment and refused to answer any questions.
A judge had imposed a fine of $50,000 daily for each day Paramount didn't turn over serial numbers and the ATMs, with the fine rising to $100,000 a day on Dec. 14. With this recent development, there is now concern over whether investors will get paid at all or gain back the ATMs.
"Everyone at Paramount was laid off or quit. I'm not sure we can salvage anything," Matta Haverstick, an attorney representing one of the investment funds, said in the report.
There is also an issue surrounding how many ATMs Paramount actually owns, as there is evidence that Paramount does not own the majority of the ATMs on its network. In addition, during the earlier hearing, Brench Bauman, owner of Republic Amusements, said that when reviewing a list of 28,000 serial numbers, almost 18,000 of them were not from ATMs.
Jorge Fernandez, chief development officer at Bitstop, said that the number of ATMs Paramount controls has dipped significantly.
"At its peak, Paramount operated approximately 20,000 ATMs. However, as of last Friday, when operations officially closed, that number had dwindled to fewer than 6,000. Currently, the estimate stands at less than 1,500. All of these machines have now been taken over by competitors," Jorge Fernandez, chief development officer at Bitstop, said in an email statement to ATM Marketplace.
He added that now investors have "little to no hope of recovering their investments" and that, "This situation is shaping up to be a tragic chapter for both the ATM and Bitcoin ATM industries -- one that could have been prevented with better management and foresight. Meanwhile, over 70 employees will face the holiday season without jobs."