US Attorney’s Office Announces Criminal Fraud Charges Against Alex Mashinsky

The United States Attorney for the Southern District of New York and the Federal Bureau of Investigation have announced fraud charges against Alex Mashinsky, the former CEO of bankrupt crypto lender Celsius.

In a July 13 announcement, the US Department of Justice Said It charged Mashinsky with securities fraud, commodity fraud and wire fraud for allegedly defrauding customers and misleading them about the “success, profitability and investment nature” of Celsius, a platform built with user funds. was related. However, authorities said they had reached a “non-prosecution agreement” with Celsius, which “agreed to accept responsibility for its role in the fraudulent schemes.”

US Attorney Damian Williams said, “If you defrauded ordinary investors to line your pockets, we will hold you accountable.” “Whether it’s an old school fraud or some new school crypto scheme, it doesn’t matter. It is all a hoax for us. And we’ll be here to capture it.”

Ronnie Cohen-Pavone, former chief revenue officer of Celsius, and Mashinsky will also face charges of conspiracy, securities fraud, market manipulation and wire fraud related to manipulating the price of Celsius (CEL) tokens. According to the allegations, Mashinsky profited approximately $42 million from the sale of CEL by artificially inflating the price, while Cohen-Pavone made approximately $3.6 million.

Authorities reportedly arrested Mashinsky, a New York resident, on July 13 as part of the indictment, which includes seven criminal counts. Cohen-Pavon, a resident of Israel, faces four charges.

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The allegations come amid several legal actions against Celsius and Mashinsky following the platform’s collapse and financial difficulties in 2022. Celsius suspended withdrawals on its platform, and several US state securities regulators were also investigating the firm.

The New York Attorney General’s office filed a lawsuit against Mashinsky on January 5, alleging that the former CEO misled Celsius investors, resulting in billions of dollars in losses. The US Securities and Exchange Commission filed its own civil lawsuit on July 13 citing similar allegations against Celsius and Mashinsky. In addition, the Federal Trade Commission issued a $4.7 billion fine against Celsius.

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