The CFTC may initiate a lawsuit against Celsius as soon as this month.

The state of New York filed a lawsuit against Mashinsky on January 5.

Bankrupt crypto lender Celsius and its former CEO Alex Mashinsky allegedly infringed many United States rules before the company’s collapse in 2022, as found by investigators from the Commodity Futures Trading Commission (CFTC).

Attorneys from the CFTC’s enforcement section reportedly determined that Celsius deceived investors, failed to register with the regulator, and Mashinsky breached many rules, as reported by Bloomberg on July 5.

Lawsuit Underway

According to the sources, the CFTC may initiate a lawsuit against the defunct crypto lender in U.S. federal court as soon as this month if the majority of its commissioners agree with the investigators’ conclusions.

The results of the CFTC’s investigation are the latest in a slew of legal steps taken against the bankrupt cryptocurrency lending platform. The state of New York filed a lawsuit against Mashinsky on January 5 for allegedly losing billions of dollars due to the former CEO’s fraudulent actions.

Moreover, three days after Celsius unexpectedly ceased customer withdrawals on June 13, 2022, securities regulators from five different U.S. states launched an inquiry against the company on June 16.

Furthermore, court documents reveal that several investigations were opened by the Securities and Exchange Commission and federal prosecutors in Manhattan. According to Bloomberg’s reporting, the Securities and Exchange Commission (SEC) and the U.S. Attorney’s Office for the Southern District of New York have both refused to comment on the current state of the investigations.

An independent examiner hired by U.S. courts in January concluded that Celsius sometimes behaved like a Ponzi scheme, a conclusion that was shared by Vermont’s financial regulator.

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Filed under: Bitcoin - @ July 6, 2023 5:24 pm