The FTC and Celsius have reached a $4.7 billion settlement agreement, while their co-founder has not reached a settlement yet. The Department of Justice has reached a non-prosecution agreement with Celsius.
2023-07-13 14:06
The Federal Trade Commission (FTC) has reached a settlement agreement with cryptocurrency lending company Celsius Network, which will be banned from handling consumers' assets. The platform is accused of luring consumers to transfer cryptocurrency to their platform through false promises of secure and readily available deposits.
The proposed settlement agreement between the FTC and Celsius and its subsidiaries will permanently prohibit these companies from offering, marketing, or promoting any products or services that can be used for depositing, exchanging, investing, or withdrawing any assets. Celsius and its subsidiaries have agreed to pay a $47 billion judgment, which will be stayed to allow Celsius to return its remaining assets to consumers in a bankruptcy proceeding.
Former CEO and co-founder Alexander Mashinsky, as well as Celsius' other co-founders Shlomi Daniel Leon and Hanoch "Nuke" Goldstein, have not agreed to the settlement, and the FTC's lawsuit against them will continue in federal court.
In addition, the U.S. Attorney's Office for the Southern District of New York has announced that Alexander Mashinsky is charged with defrauding Celsius customers and committing securities fraud, commodities fraud, and wire fraud. Furthermore, Mashinsky and Celsius Chief Revenue Officer Roni Cohen-Pavon are charged with manipulating the CEL token market, including conspiracy, securities fraud, market manipulation, and wire fraud.
Damian Williams, the U.S. Attorney for the Southern District of New York, also announced that the U.S. has reached a non-prosecution agreement with Celsius Network LLC. Because the company has taken responsibility for its role in the alleged fraudulent scheme and has committed to continuing to cooperate with relevant investigations and U.S. law enforcement and regulatory agencies, criminal charges will not be filed against Celsius Network LLC and its subsidiaries.
The proposed settlement agreement between the FTC and Celsius and its subsidiaries will permanently prohibit these companies from offering, marketing, or promoting any products or services that can be used for depositing, exchanging, investing, or withdrawing any assets. Celsius and its subsidiaries have agreed to pay a $47 billion judgment, which will be stayed to allow Celsius to return its remaining assets to consumers in a bankruptcy proceeding.
Former CEO and co-founder Alexander Mashinsky, as well as Celsius' other co-founders Shlomi Daniel Leon and Hanoch "Nuke" Goldstein, have not agreed to the settlement, and the FTC's lawsuit against them will continue in federal court.
In addition, the U.S. Attorney's Office for the Southern District of New York has announced that Alexander Mashinsky is charged with defrauding Celsius customers and committing securities fraud, commodities fraud, and wire fraud. Furthermore, Mashinsky and Celsius Chief Revenue Officer Roni Cohen-Pavon are charged with manipulating the CEL token market, including conspiracy, securities fraud, market manipulation, and wire fraud.
Damian Williams, the U.S. Attorney for the Southern District of New York, also announced that the U.S. has reached a non-prosecution agreement with Celsius Network LLC. Because the company has taken responsibility for its role in the alleged fraudulent scheme and has committed to continuing to cooperate with relevant investigations and U.S. law enforcement and regulatory agencies, criminal charges will not be filed against Celsius Network LLC and its subsidiaries.
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