New York State Attorney General has filed a lawsuit against Celsius, the former CEO of bankrupt crypto lender Celsius. He is alleged to have defrauded investors.
Letitia James has filed a press release naming Alex Mashinsky as Celsius founder. She claims that he made misleading statements about various aspects of the company to investors and did not properly register as required under state law.
“As the former CEO of Celsius, Alex Mashinsky promised to lead investors to financial freedom but led them down a path of financial ruin. It is against the law to make false or unsubstantiated promises to investors and deceive them.
Today we are taking legal action for thousands of New Yorkers who were defrauded and ripped off by Mr. Mashinsky in order to recover their losses. My office will stay vigilant and ensure that bad actors trying to take advantage of New York investors are held accountable.”
James claims that Mashinksy claimed to have told customers that Celsius would make low-risk investments, and that he would only lend assets out to reputable businesses. However, he “routinely” loaned assets to high-risk counterparties instead and led investors to a path of “financial ruin.”
If James’ lawsuit prevails, it would bar Mashinsky from ever doing business again in New York as well as pay an unnamed sum in damages, restitution, and disgorgement, according to the press release.
Celsius filed for bankruptcy first in July 2022, just weeks after its native asset crashed by more than 99 percent. This forced Celsius to stop customer withdrawals.
The company stated that extreme market volatility was the reason why it had to close down.
Don’t Miss a Beat – Subscribe to get crypto email alerts delivered directly to your inbox
Take a look at the Price Action
Follow us on TwitterTelegram, Facebook, and Telegram
Surf the Daily Hodl Mix