Just before the now-defunct crypto lender Celsius was charged by three U.S. federal regulators — the Commodity Futures Trading Commission (CFTC), Securities and Exchange Commission (SEC), and Federal Trade Commission (FTC) — its former CEO, Alexander Mashinsky, was arrested on fraud charges Thursday. A U.S. judge has set Mashinsky’s bail at $40 million and restricted him from traveling.
Fraud Charges Lead to $40 Million Bail Bond for Former Celsius CEO Mashinsky
Alexander Mashinsky, founder and former CEO of Celsius, was arrested and charged with fraud Thursday in New York. Mashinsky’s legal team said he vehemently denies the allegations and described the charges as unfounded. “[Mashinsky] vehemently denies the allegations brought today,” attorney Jonathan Ohring said in an email to The Washington Post.
U.S. Attorney Damian Williams on today's indictment against Alexander Mashinsky and Roni Cohen-Pavon: “Exactly one year ago today, Celsius Network, a crypto platform that, at its height, managed approximately $25 billion in customer assets, filed for bankruptcy protection 1/6
— US Attorney SDNY (@SDNYnews) July 13, 2023
Mashinsky’s bail was set at $40 million, and he is restricted from leaving the Southern District of New York, according to his bail agreement. Mashinsky lives in Manhattan with his wife, who co-signed his bail agreement along with an unknown co-signer. In addition to travel restrictions, the Celsius founder is prohibited from opening a bank account or trading crypto assets.
His bond was secured by funds in his bank account and his Manhattan residence. Mashinsky’s arrest occurred before the CFTC, SEC, and FTC filed charges against Celsius, its related companies and three former executives, including Mashinsky.
The indictment against the former CEO of Celsius alleges that from 2018 to 2022, Mashinsky and Celsius misled investors. It accuses Mashinsky of manipulating the market of the Celsius Network’s CEL token and committing fraud.
The Securities and Exchange Commission’s charges against Celsius and Mashinsky assert investors were sold unregistered securities through fraudulent, unregistered offerings. Ohring, Mashinsky’s lawyer, called the accusations “baseless” and emphasized Mashinsky’s eagerness to defend himself in court.
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