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{"actor":"system:backfill","investigation_id":"0c45d86d-84b3-4803-847f-a4cedc60b7e0","kind":"publish","page_slug":"fortress-trust","published_at":"2026-10-28T08:19:56.092Z","sequence_num":1,"snapshot":{"content_type":"investigation","entity_name":"Fortress Trust","sections":[{"content":"On October 22, 2025, the Nevada Department of Business and Industry, Financial Institutions Division (NFID) issued an Order to Cease and Desist against Fortress Trust, LLC for violations of NRS Chapter 669, the statute governing Nevada trust companies. The order's findings of fact state that on or about October 7, 2025, Fortress represented to the Division that it was on the verge of insolvency and would not be able to continue operations or meet customer withdrawals, and that on October 16, 2025 it informed the Division it was unable to honor customer withdrawals. According to the order and an attached declaration from Fortress CEO Anthony Botticella, the firm owed clients approximately $8,370,629 in fiat currency while holding only about $194,421 in custodial fiat, a fiat deficit of roughly $8.18 million, and owed clients approximately $3,923,000 in cryptocurrency (converted to USD) while holding about $1,097,000 in custodial crypto assets, a crypto deficit of roughly $2.83 million. Combined, the order's own figures show Fortress owed clients a total of approximately $12.29 million against roughly $1.29 million in actual custodial assets. The order also found that Fortress could not provide documentation showing its accounts were reconciled, could not produce financial statements for July, August or September 2025, and was operating with only two of the five board members required by Nevada law. The Commissioner concluded Fortress's liquidity position was 'wholly inadequate to meet customer obligations' and that the firm had 'materially and willfully breached its fiduciary duties to its customers.' In his declaration, Botticella, who became CEO in December 2023, stated he learned after taking the role that the Trust was already experiencing severe financial difficulties tied to events that occurred before his tenure, including an inability to reconcile amounts under the Trust's administration. News outlets reported slightly varying summary figures (e.g., roughly $12 million owed against $1.2-1.3 million on hand, or an approximately $8.1 million deficit figure drawn from the fiat-side shortfall alone in a later court petition); the order's own itemized figures above are the most granular available and are treated as authoritative here.","heading":"Nevada Cease-and-Desist Order and Insolvency Finding (October 2025)","severity":"critical","sources":[{"credibility":1,"name":"Nevada FID Order to Cease and Desist, Fortress Trust, LLC (October 22, 2025)","type":"regulatory","url":"https://fid.nv.gov/uploadedFiles/fidnvgov/content/Opinion/Fortress%20Trust%20LLC%20-%20Cease%20and%20Desist%2010.22.25.pdf"},{"credibility":2,"name":"Fortress Trust is insolvent (Web3 Is Going Just Great)","type":"news_article","url":"https://web3isgoinggreat.com/single/fortress-trust-insolvency"},{"credibility":2,"name":"Nevada Shuts Down Fortress Trust Over Insolvency (Cryptonews)","type":"news_article","url":"https://cryptonews.com/news/nevada-shuts-down-fortress-trust-over-insolvency/"},{"credibility":1,"name":"Nevada Issues Cease-and-Desist Order to Crypto's Fortress Trust (Bloomberg Law)","type":"news_article","url":"https://news.bgov.com/bankruptcy-law/nevada-issues-cease-and-desist-order-to-cryptos-fortress-trust"}]},{"content":"The Nevada FID subsequently petitioned Nevada's Eighth Judicial District Court (Clark County) to place Elemental Financial Technologies, Inc. — described by the FID as formerly known as Fortress Blockchain Technologies — and its subsidiaries, including Fortress Trust, LLC, into receivership. The court granted the petition, and the FID announced on November 24, 2025 that John Guedry, a former CEO of Bank of Nevada and First Independent Bank, had been appointed permanent receiver with full authority over the companies' assets and operations under court supervision. Under the order, company officers, employees, agents and affiliates are barred from transferring or disposing of assets, including digital assets and customer records, or conducting business except as directed by the receiver, and the receiver was required to file an asset inventory with the court within 45 days. FID Commissioner Sandy O'Laughlin said the action was taken 'to safeguard the interests of consumers and the integrity of Nevada's financial system.' A Nevada state court petition cited a company-wide deficit cited in press coverage as approximately $8.1 million, including the $3.9 million owed to cryptocurrency clients against roughly $1.1 million held in custody — figures consistent with (and apparently drawn from) the cease-and-desist order's crypto- and fiat-side findings described above. Guedry had also served as the court-appointed receiver for Prime Trust LLC in 2023, placing him in that role for both Nevada custodial collapses.","heading":"Court-Appointed Receivership (November 2025)","severity":"critical","sources":[{"credibility":1,"name":"Nevada FID press release: receiver appointed for Elemental Financial Technologies and subsidiaries","type":"regulatory","url":"https://business.nv.gov/news-media/press-releases/2025/financial-institutions/nevada-financial-institutions-division-secures-court-appointed-receiver-for-elemental-financial-technologies-inc.-formerly-fortress-blockchain-technologies-and-subsidiaries"},{"credibility":1,"name":"Order Granting Petition, Elemental Financial Technologies Inc. receivership","type":"court_filing","url":"https://prod.business.nv.gov/siteassets/content/files/elemental-financial-technologies-inc.-order-granting-petition.pdf"},{"credibility":2,"name":"Fortress Blockchain $8.1 million in the red as receiver appointed (8NewsNow/KLAS)","type":"news_article","url":"https://digital-release.8newsnow.com/news/local-news/fortress-blockchain-8-1-million-in-the-red-as-receiver-appointed-to-take-over-assets-accounts"}]},{"content":"In September 2023, Ripple (the company behind XRP) announced plans to acquire Fortress Trust; Fortune reported Ripple 'announced on Friday its acquisition of Fortress Trust' in an article published September 8, 2023. Shortly after the announcement, Fortress disclosed a security incident in which, according to The Block, hackers accessed a limited number of customer accounts through a third-party vendor; Fortress and Ripple stated Ripple helped cover losses for affected customers as part of the pending deal. News reports described the stolen amount as in the range of $12 million to $15 million. On September 28, 2023, Ripple CEO Brad Garlinghouse announced on social media that Ripple would not complete the outright acquisition, though Ripple said it would remain an investor in Fortress's parent company. Fortress CEO Scott Purcell said the decision followed internal disagreement at Ripple over business priorities and said no customers were affected by the change in plans. Purcell stepped down as Fortress CEO in October 2023; Anthony Botticella became CEO in December 2023. It is unclear from available reporting whether funds lost in the 2023 incident were fully restored prior to the 2025 insolvency findings.","heading":"2023 Security Incident and Collapsed Ripple Acquisition","severity":"high","sources":[{"credibility":2,"name":"Fortress CEO Responds to Ripple Backing Out of Acquisition (Decrypt)","type":"news_article","url":"https://decrypt.co/199250/fortress-ceo-responds-to-ripple-backing-out-of-acquisition"},{"credibility":1,"name":"Ripple Acquires Fortress Trust (Fortune)","type":"news_article","url":"https://fortune.com/crypto/2023/09/08/ripple-acquires-fortress-trust-metaco-undisclosed-cash-equity-purchase"},{"credibility":2,"name":"Ripple Made Fortress Customers Hit by Security Incident Whole as Part of Acquisition (The Block)","type":"news_article","url":"https://www.theblock.co/post/250082/ripple-made-fortress-customers-hit-by-security-incident-whole-as-part-of-acquisition"},{"credibility":2,"name":"Fortress Trust is insolvent (Web3 Is Going Just Great)","type":"news_article","url":"https://web3isgoinggreat.com/single/fortress-trust-insolvency"}]},{"content":"Before the October 2025 insolvency finding, Fortress Trust was subject to separate state money-transmission enforcement actions. On February 13, 2024, the Connecticut Department of Banking issued an Order of Summary Suspension and related notices against Fortress Trust, alleging it had failed to maintain the minimum tangible net worth required of money transmission licensees, failed to timely file required change-of-control and office-location notices with the Nationwide Multistate Licensing System, and failed to maintain adequate compliance policies. Fortress resolved the matter through a Consent Order issued in Hartford, Connecticut on August 14, 2024, agreeing to pay a $75,000 civil penalty, restore the required net worth by September 30, 2024, retain an external compliance consultant, and undergo an independent compliance audit, without admitting or denying the underlying allegations. Separately, the Pennsylvania Department of Banking and Securities entered a Consent Agreement and Order with Fortress Trust on April 2, 2024 over an alleged failure to maintain the $500,000 tangible net worth required under Pennsylvania's Money Transmitter Act; Fortress agreed to pay a $30,000 fine without admitting the allegations. The Pennsylvania order's figures and date are drawn from secondary reporting, as the primary Pennsylvania Department of Banking and Securities enforcement page could not be directly verified during this investigation.","heading":"Prior State Regulatory Actions (Connecticut and Pennsylvania, 2024)","severity":"medium","sources":[{"credibility":1,"name":"Connecticut Department of Banking Consent Order, Fortress Trust LLC (August 14, 2024)","type":"regulatory","url":"https://portal.ct.gov/-/media/dob/enforcement/consumer-credit/2024-cc-orders/fortress-trust-llc-dba-fortress-trust---consent-order.pdf"},{"credibility":1,"name":"Connecticut Department of Banking Bulletin 3156 (August 16, 2024)","type":"regulatory","url":"https://portal.ct.gov/dob/bulletin/2024/bulletin-3156-august-16-2024"},{"credibility":2,"name":"Pennsylvania consent order summary (RegAlert)","type":"regulatory","url":"https://regalert.today/document/9c9ce3cf-1c50-4ab1-bac2-f166bfb2826e"}]},{"content":"Fortress Trust's founder, Scott Purcell, previously founded and led Prime Trust LLC, a separate Nevada-chartered crypto custodian, before leaving that role in 2021 to start the company that became Fortress Blockchain Technologies / Fortress Trust. Nevada's FID placed Prime Trust into receivership in mid-2023 after finding it insolvent and unable to serve customers; regulatory reporting indicated Prime Trust owed more than $82 million to customers in missing fiat deposits despite holding roughly $68 million in digital assets, a shortfall regulators and the company traced to lost access to a hardware wallet holding customer crypto since December 2021. Prime Trust's parent, Prime Core Technologies, filed for Chapter 11 bankruptcy protection in mid-August 2023. Purcell has publicly disputed responsibility for Prime Trust's later problems, stating he departed while the company was performing well and before the issues that caused its collapse arose; this is a contested characterization rather than an established finding. Commentators, including the independent crypto-incident tracker Web3 Is Going Just Great, have noted that both companies experienced strikingly similar failure patterns — an inability to reconcile customer-asset shortfalls discovered by Nevada regulators — and that both were ultimately placed under the same court-appointed receiver, John Guedry.","heading":"Pattern With Sister Company Prime Trust","severity":"high","sources":[{"credibility":2,"name":"Fortress Trust is insolvent (Web3 Is Going Just Great)","type":"news_article","url":"https://web3isgoinggreat.com/single/fortress-trust-insolvency"},{"credibility":2,"name":"Crypto Custodian Prime Trust Files for Bankruptcy (Decrypt)","type":"news_article","url":"https://decrypt.co/152508/prime-trust-chapter-11-bankruptcy"},{"credibility":2,"name":"Prime Trust founder and former CEO Scott Purcell says firm in receivership (Crowdfund Insider)","type":"news_article","url":"https://www.crowdfundinsider.com/2023/06/209154-prime-trust-founder-and-former-ceo-scott-purcell-says-firm-in-receivership-incredibly-sad-to-see/"},{"credibility":2,"name":"Fortress Blockchain $8.1 million in the red as receiver appointed (8NewsNow/KLAS)","type":"news_article","url":"https://digital-release.8newsnow.com/news/local-news/fortress-blockchain-8-1-million-in-the-red-as-receiver-appointed-to-take-over-assets-accounts"}]}],"sources_used":[{"credibility":1,"name":"Nevada FID Order to Cease and Desist, Fortress Trust, LLC (October 22, 2025)","type":"regulatory","url":"https://fid.nv.gov/uploadedFiles/fidnvgov/content/Opinion/Fortress%20Trust%20LLC%20-%20Cease%20and%20Desist%2010.22.25.pdf"},{"credibility":1,"name":"Nevada FID press release: receiver appointed for Elemental Financial Technologies and subsidiaries","type":"regulatory","url":"https://business.nv.gov/news-media/press-releases/2025/financial-institutions/nevada-financial-institutions-division-secures-court-appointed-receiver-for-elemental-financial-technologies-inc.-formerly-fortress-blockchain-technologies-and-subsidiaries"},{"credibility":1,"name":"Order Granting Petition, Elemental Financial Technologies Inc. receivership","type":"court_filing","url":"https://prod.business.nv.gov/siteassets/content/files/elemental-financial-technologies-inc.-order-granting-petition.pdf"},{"credibility":1,"name":"Connecticut Department of Banking Consent Order, Fortress Trust LLC (August 14, 2024)","type":"regulatory","url":"https://portal.ct.gov/-/media/dob/enforcement/consumer-credit/2024-cc-orders/fortress-trust-llc-dba-fortress-trust---consent-order.pdf"},{"credibility":1,"name":"Connecticut Department of Banking Bulletin 3156 (August 16, 2024)","type":"regulatory","url":"https://portal.ct.gov/dob/bulletin/2024/bulletin-3156-august-16-2024"},{"credibility":2,"name":"Pennsylvania consent order summary (RegAlert)","type":"regulatory","url":"https://regalert.today/document/9c9ce3cf-1c50-4ab1-bac2-f166bfb2826e"},{"credibility":2,"name":"Fortress Trust is insolvent (Web3 Is Going Just Great)","type":"news_article","url":"https://web3isgoinggreat.com/single/fortress-trust-insolvency"},{"credibility":2,"name":"Nevada Shuts Down Fortress Trust Over Insolvency (Cryptonews)","type":"news_article","url":"https://cryptonews.com/news/nevada-shuts-down-fortress-trust-over-insolvency/"},{"credibility":2,"name":"Nevada shuts down Fortress Trust: who holds your keys during custody consolidation? (CryptoSlate)","type":"news_article","url":"https://cryptoslate.com/nevada-shuts-down-fortress-trust-who-holds-your-keys-during-custody-consolidation/"},{"credibility":1,"name":"Nevada Issues Cease-and-Desist Order to Crypto's Fortress Trust (Bloomberg Law)","type":"news_article","url":"https://news.bgov.com/bankruptcy-law/nevada-issues-cease-and-desist-order-to-cryptos-fortress-trust"},{"credibility":2,"name":"Fortress Blockchain $8.1 million in the red as receiver appointed (8NewsNow/KLAS)","type":"news_article","url":"https://digital-release.8newsnow.com/news/local-news/fortress-blockchain-8-1-million-in-the-red-as-receiver-appointed-to-take-over-assets-accounts"},{"credibility":2,"name":"Fortress CEO Responds to Ripple Backing Out of Acquisition (Decrypt)","type":"news_article","url":"https://decrypt.co/199250/fortress-ceo-responds-to-ripple-backing-out-of-acquisition"},{"credibility":1,"name":"Ripple Acquires Fortress Trust (Fortune)","type":"news_article","url":"https://fortune.com/crypto/2023/09/08/ripple-acquires-fortress-trust-metaco-undisclosed-cash-equity-purchase"},{"credibility":2,"name":"Ripple Made Fortress Customers Hit by Security Incident Whole as Part of Acquisition (The Block)","type":"news_article","url":"https://www.theblock.co/post/250082/ripple-made-fortress-customers-hit-by-security-incident-whole-as-part-of-acquisition"},{"credibility":2,"name":"Crypto Custodian Prime Trust Files for Bankruptcy (Decrypt)","type":"news_article","url":"https://decrypt.co/152508/prime-trust-chapter-11-bankruptcy"},{"credibility":2,"name":"Prime Trust founder and former CEO Scott Purcell says firm in receivership (Crowdfund Insider)","type":"news_article","url":"https://www.crowdfundinsider.com/2023/06/209154-prime-trust-founder-and-former-ceo-scott-purcell-says-firm-in-receivership-incredibly-sad-to-see/"}],"summary":"Fortress Trust, LLC was a Nevada-chartered crypto custodian and subsidiary of Elemental Financial Technologies, Inc. (formerly Fortress Blockchain Technologies). Nevada's Financial Institutions Division issued a cease-and-desist order on October 22, 2025 after finding the firm on the verge of insolvency, unable to meet customer withdrawals, and unable to produce basic account reconciliations, with regulatory filings showing roughly $12.3 million owed to clients against about $1.3 million in custodial assets. A Nevada court subsequently appointed a receiver over the company and its subsidiaries. Fortress's founder, Scott Purcell, also previously led sister company Prime Trust, which collapsed into Nevada receivership and bankruptcy in 2023 after a similar custodial-asset shortfall, and both firms were later placed under the same court-appointed receiver, John Guedry.","timeline":[{"date":"2022-05-12","date_evidence":"On or about May 12, 2022, Respondent was granted a license (TR10048) pursuant to NRS 669 authorizing Respondent to operate a trust company in the State of Nevada.","event":"Fortress Trust, LLC granted a Nevada retail trust company license (TR10048).","source":"Nevada FID Order to Cease and Desist","source_url":"https://fid.nv.gov/uploadedFiles/fidnvgov/content/Opinion/Fortress%20Trust%20LLC%20-%20Cease%20and%20Desist%2010.22.25.pdf"},{"date":"2023-06","event":"Nevada regulators placed sister company Prime Trust LLC into receivership after finding it insolvent.","source":"Crowdfund Insider","source_url":"https://www.crowdfundinsider.com/2023/06/209154-prime-trust-founder-and-former-ceo-scott-purcell-says-firm-in-receivership-incredibly-sad-to-see/"},{"date":"2023-08","event":"Prime Trust's parent, Prime Core Technologies, filed for Chapter 11 bankruptcy.","source":"Decrypt","source_url":"https://decrypt.co/152508/prime-trust-chapter-11-bankruptcy"},{"date":"2023-09","date_evidence":"Ripple ... announced on Friday its acquisition of Fortress Trust.","date_original":"2023-09-08","event":"Ripple announced plans to acquire Fortress Trust.","source":"Fortune","source_url":"https://fortune.com/crypto/2023/09/08/ripple-acquires-fortress-trust-metaco-undisclosed-cash-equity-purchase"},{"date":"2023-09","event":"Fortress disclosed a security incident involving a third-party vendor, with reported losses of roughly $12 million to $15 million in customer crypto.","source":"The Block / Decrypt","source_url":"https://www.theblock.co/post/250082/ripple-made-fortress-customers-hit-by-security-incident-whole-as-part-of-acquisition"},{"date":"2023-09-28","date_evidence":"Garlinghouse confirmed the decision on Thursday; article dated Sep 28, 2023.","event":"Ripple CEO Brad Garlinghouse announced Ripple would not complete the Fortress Trust acquisition, remaining only a minority investor.","source":"Decrypt","source_url":"https://decrypt.co/199250/fortress-ceo-responds-to-ripple-backing-out-of-acquisition"},{"date":"2023-09-25","date_evidence":"On September 25, 2023, the Division commenced a safety and soundness examination of Respondent.","event":"Nevada FID commenced a safety-and-soundness examination of Fortress Trust.","source":"Nevada FID Order to Cease and Desist","source_url":"https://fid.nv.gov/uploadedFiles/fidnvgov/content/Opinion/Fortress%20Trust%20LLC%20-%20Cease%20and%20Desist%2010.22.25.pdf"},{"date":"2023-10","event":"Fortress CEO Scott Purcell stepped down following the acquisition's collapse.","source":"Web3 Is Going Just Great","source_url":"https://web3isgoinggreat.com/single/fortress-trust-insolvency"},{"date":"2023-12","event":"Anthony Botticella became CEO of Fortress Trust.","source":"Nevada FID Order to Cease and Desist (Botticella declaration)","source_url":"https://fid.nv.gov/uploadedFiles/fidnvgov/content/Opinion/Fortress%20Trust%20LLC%20-%20Cease%20and%20Desist%2010.22.25.pdf"},{"date":"2024-02-13","date_evidence":"on February 13, 2024, the Commissioner issued an Order of Summary Suspension, Temporary Order to Cease and Desist...","event":"Connecticut Department of Banking issued a summary suspension and cease-and-desist notice against Fortress Trust over money-transmission compliance failures.","source":"Connecticut Department of Banking Consent Order","source_url":"https://portal.ct.gov/-/media/dob/enforcement/consumer-credit/2024-cc-orders/fortress-trust-llc-dba-fortress-trust---consent-order.pdf"},{"date":"2024-04","date_original":"2024-04-02","event":"Pennsylvania Department of Banking and Securities entered a consent order against Fortress Trust over an alleged tangible net worth shortfall, with a $30,000 fine.","source":"RegAlert / Pennsylvania DOBS enforcement summary","source_url":"https://regalert.today/document/9c9ce3cf-1c50-4ab1-bac2-f166bfb2826e"},{"date":"2024-08","date_evidence":"Issued at Hartford, Connecticut this 14th day of August, 2024.","date_original":"2024-08-14","event":"Connecticut Consent Order finalized, with Fortress Trust agreeing to pay a $75,000 civil penalty and undergo compliance remediation.","source":"Connecticut Department of Banking Consent Order","source_url":"https://portal.ct.gov/-/media/dob/enforcement/consumer-credit/2024-cc-orders/fortress-trust-llc-dba-fortress-trust---consent-order.pdf"},{"date":"2025-10-07","date_evidence":"On or about October 7, 2025, Respondent represented to the Division that it was on the verge of insolvency...","event":"Fortress Trust told Nevada regulators it was on the verge of insolvency.","source":"Nevada FID Order to Cease and Desist","source_url":"https://fid.nv.gov/uploadedFiles/fidnvgov/content/Opinion/Fortress%20Trust%20LLC%20-%20Cease%20and%20Desist%2010.22.25.pdf"},{"date":"2025-10-16","date_evidence":"On or about October 16, 2025, Respondent informed the Division that it was unable to honor customer withdrawals.","event":"Fortress Trust informed regulators it could not honor customer withdrawal requests.","source":"Nevada FID Order to Cease and Desist","source_url":"https://fid.nv.gov/uploadedFiles/fidnvgov/content/Opinion/Fortress%20Trust%20LLC%20-%20Cease%20and%20Desist%2010.22.25.pdf"},{"date":"2025-10-21","date_evidence":"On October 21, 2025, Respondent informed the Division that TPB decided against purchasing Respondent.","event":"A prospective third-party buyer/bridge financier decided against purchasing or funding Fortress Trust.","source":"Nevada FID Order to Cease and Desist","source_url":"https://fid.nv.gov/uploadedFiles/fidnvgov/content/Opinion/Fortress%20Trust%20LLC%20-%20Cease%20and%20Desist%2010.22.25.pdf"},{"date":"2025-10","date_evidence":"DATED this 22nd day of October 2025.","date_original":"2025-10-22","event":"Nevada FID issued a Cease and Desist Order against Fortress Trust, LLC, citing insolvency, inability to reconcile accounts, and failure to meet customer obligations.","source":"Nevada FID Order to Cease and Desist","source_url":"https://fid.nv.gov/uploadedFiles/fidnvgov/content/Opinion/Fortress%20Trust%20LLC%20-%20Cease%20and%20Desist%2010.22.25.pdf"},{"date":"2025-11","date_original":"2025-11-24","event":"Nevada FID announced a court-appointed receiver, John Guedry, had been granted authority over Elemental Financial Technologies, Inc. and its subsidiaries, including Fortress Trust, LLC.","source":"Nevada FID press release","source_url":"https://business.nv.gov/news-media/press-releases/2025/financial-institutions/nevada-financial-institutions-division-secures-court-appointed-receiver-for-elemental-financial-technologies-inc.-formerly-fortress-blockchain-technologies-and-subsidiaries"}]},"v":1}