Celsius Co-Founder Mashinsky Sued By NY Attorney General For “Defrauding Investors Out Of Billions”

Celsius co-founder Mashinsky is being sued by the NY Attorney General for “defrauding investors out of billions”. The lawsuit accuses Mashinsky of violating the state’s Martin Act, which is used to combat securities and commodities fraud, as well as a state general business law that allows the attorney general to investigate fraud. This article will explore the details of the case and its potential implications for the crypto industry.

Celsius Co-Founder Mashinsky Sued By NY Attorney General For Defrauding Investors Out Of Billions

The New York Attorney General has filed a civil lawsuit against Alex Mashinsky, co-founder of the now-bankrupt Celsius Network LLC, for defrauding investors out of billions of dollars’ worth of cryptocurrency.

As reported by the Wall Street Journal, the lawsuit accuses Mashinsky of making false statements about the financial stability of Celsius and hiding the company’s financial difficulties after it suffered losses of hundreds of millions of dollars from risky investments. Mashinsky had reportedly claimed that Celsius was a safer option than a bank and only lent to trustworthy organizations.

“Alex Mashinsky lied to people about the risks of investing in Celsius, hid its deteriorating financial condition, and failed to register in New York. Mashinsky tricked hardworking people into investing their life savings into Celsius, promising big financial returns and claiming the platform was safer than a bank” said James, a Democrat. “Instead, Celsius collapsed and New Yorkers were left in financial ruin”

“The law is clear that making false and unsubstantiated promises and misleading investors is illegal” she added noting that she is “suing to get New Yorkers their money back and ban Mashinsky from doing business in New York.”

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The lawsuit lodged against Alex Mashinsky accuses him of violating New York’s Martin Act, which is used to address securities and commodities fraud, as well as a state general business law that permits the attorney general to investigate fraud.

According to its bankruptcy filing, Celsius owes its customers roughly $4.7 billion, and its balance sheet has a hole of about $1.2 billion. Let’s take a look inside of Celsius’ $25 billion bankruptcy filing.

At this stage, no criminal allegations have been made against Mashinsky.

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