July 13, 2023 11:25 am Comments

Former Celsius CEO Alex Mashinsky has been arrested, according to sources. …

The former head of the now-defunct crypto lending platform was formally sued by New York Attorney General Letitia James in January of 2023.

James’ lawsuit was purely a civil action and alleged that Mashinsky defrauded investors out of billions.

Now Mashinsky and Celsius have been formally charged by the Securities and Exchange Commission for fraud and market manipulation. Additionally, Celsius will be paying a hefty fine to the SEC.

If convicted, Mashinsky faces upward of 20 years behind bars. …

Reports were initially unclear and inconclusive; however, multiple outlets and sources are now reporting:

Coin Telegraph confirmed the story and provided this background information on the collapse of Celsius:

The trouble for Celsius and its former CEO began in June last year when the crypto lender abruptly suspended withdrawals on the platform.

On June 16, 2022, securities regulators from five different U.S. states opened an investigation into Celsius, and within a month, the platform filed for bankruptcy.


CNBC provided more details on New York Attorney General Letitia James’ lawsuit against Celsius:

The attorney general’s office is seeking to fine Mashinsky and levy monetary damages, and bar him from leading a company or working in the securities industry in New York.

The action is civil, not criminal, and was brought under the Martin Act, New York state’s wide-ranging securities law.

The Martin Act gives prosecutors sweeping search and subpoena powers to investigate potential wrongdoing.

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