Mawson Infrastructure CEO Terminated for Cause Amid Fraud Allegations

The board of Mawson Infrastructure, a cryptocurrency mining and colocation services provider, has terminated CEO and President Rahul Mewawalla amid allegations of fraud and misconduct. The abrupt removal, effective July 8, followed a "for Cause" termination notice issued on May 30 and administrative leave in the intervening period [3]. The Delaware lawsuit alleges Mewawalla misused his position, harmed shareholders, and engaged in unethical practices, despite having previously received $2.5 million in bonuses and a substantial stock grant earlier this year. Mewawalla has denied wrongdoing, emphasizing his prior public support and "respectfully and vigorously" rejecting the board’s claims [2]. General counsel Kaliste Saloom now serves as interim CEO, tasked with managing the company through an anticipated protracted legal battle while the board seeks financial damages tied to the alleged misconduct.

The ouster has intensified scrutiny of leadership practices in the crypto industry, particularly in firms operating under opaque governance structures. Mewawalla’s termination, confirmed by outlets such as TheMinerMag and metaversemediagroup, highlights risks associated with concentrated leadership in high-volatility markets [1]. The board’s use of the term "for cause" suggests formal investigations are underway, though specific details of the allegations remain undisclosed. Meanwhile, Mawson faces a parallel legal dispute with Stone Ridge (parent of NYDIG) over the control of 20,000 ASIC miners valued at $30 million. Stone Ridge claims Mewawalla improperly seized equipment and altered payout terms, escalating tensions over colocation fees and energy usage [3].

The incident coincides with broader regulatory pressures on crypto firms. Recent federal scrutiny of exchanges like Kraken underscores the sector’s heightened exposure to legal and financial risks [6]. Analysts note the case mirrors the controversy surrounding former Nikola CEO Trevor Milton’s securities fraud conviction, though the two cases differ in jurisdiction and context [6]. The Mewawalla dismissal has sparked industry debates about accountability, with critics arguing the crypto sector’s lack of standardized oversight has enabled unethical practices. Proponents, however, stress the industry’s role in advancing decentralized technologies, albeit amid rising regulatory ambiguity.

Mawson’s board has reiterated its commitment to "transparency and integrity," but the company now contends with legal, operational, and reputational challenges. Shareholders and observers will closely monitor potential restructuring efforts or litigation outcomes. The case serves as a cautionary tale for investors, reinforcing the importance of due diligence in evaluating leadership teams within high-risk sectors.

The post appeared first on Coindoo [3].

Source:

[1] [Forexgdp] https://www.forexgdp.com/news/crypto-ceo-firing-scandal/

[2] [X] https://x.com/_DailyDoseMedia/status/1947644157****16843

[3] [TheMinerMag] https://theminermag.com/news

[5] [metaversemediagroup] https://www.metaversemediagroup.co.uk/2025/07/22/mawson-ceo-fired-for-cause-amid-accusations-of-fraud-and-misconduct/

[6] [Facebook] https://www.facebook.com/groups/newsposter/posts/148****553172530/