New York Attorney General Letitia James has filed a lawsuit against Alex Mashinsky, a co-founder and former CEO of cryptocurrency lending platform Celsius Network LLC and its related entities, for the alleged defrauding of hundreds of thousands of investors ”“ including more than 26,000 New Yorkers ”“ out of billions of dollars in cryptocurrency.
In a statement issued by her office, James accused Mashinsky of repeatedly making false and misleading statements about Celsius”™ safety to encourage investors to deposit billions of dollars in digital assets onto the platform.
“As Celsius lost hundreds of millions of dollars of assets in risky investments, Mashinsky misrepresented and concealed Celsius”™s deteriorating financial condition,” the statement said. “Mashinsky also failed to register as a salesperson for Celsius and as a securities and commodities dealer. Attorney General James”™ lawsuit seeks to ban Mashinsky from doing business in New York and require him to pay damages, restitution, and disgorgement.”
James”™ office added that the “collapse of Celsius has left many individuals in financial ruin. One New York resident mortgaged two properties to invest with Celsius. A disabled veteran lost his investment of $36,000, which had taken him nearly a decade to save up. Another disabled citizen, who depended upon government assistance to supplement his $8 per hour income, lost his entire investment.”
James is seeking to ban Mashinsky from participating in the securities and commodities in New York, to prevent him from serving as a director or officer of any company doing business in New York, and to enact financial penalties and secure restitution for investors.
Photo of Alex Mashinsky: Web Summit / Flickr Creative Commons
