BREAKING: Celsius Network Fined $4.7B by the FTC

The United States Federal Trade Commission has issued a $4.7 billion fine against bankrupt crypto lender Celsius Network. However, the ruling will be suspended “to allow consumers in bankruptcy proceedings to return their remaining assets.”

as of July 13 AnnouncementCelsius and its affiliates will be permanently prohibited from “offering, marketing, or promoting any product or service that can be used to deposit, exchange, invest, or withdraw any assets “

The New Jersey-based firm marketed a variety of cryptocurrency products and services to consumers, such as interest-bearing accounts, personal loans secured by their cryptocurrency deposits, and a cryptocurrency exchange. In its complaint, the FTC alleges that co-founders Alex Mashinsky, Shlomi Lyons and Enoch Goldstein marketed the platform as a “safe place” for consumers to deposit their cryptocurrencies, while keeping $4 in consumers’ assets. Misappropriated over a billion. The co-founders have not agreed to the FTC settlement and the case against them will go to federal court.

In addition, the FTC accused Celsius of making $1.2 billion in unsecured loans, falsely claiming that it had a $750 million user insurance policy and lacking any means of tracking its assets and liabilities through the end of 2021. Even during the start of the 2022 cryptocurrency bear market, executives allegedly lied about the company’s well-being, as reported by the FTC:

“By lying to prevent their customers from withdrawing their cryptocurrency deposits, Lyons, Goldstein and Mashinsky protected themselves by withdrawing significant amounts of cryptocurrency from Celsius two months before the company filed for bankruptcy. Consumers subsequently lost access to their life savings, college funds and money saved for retirement.

The same day, the US Securities and Exchange Commission and the Commodity Futures Trading Commission also filed suit against Celsius. At the same time, Mashinsky was indicted by the US Department of Justice on seven charges related to fraud and was subsequently taken into custody. Celsius previously filed for bankruptcy last July.

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