Mashinsky, the former CEO of Celsius, will be sued in New York for civil fraud lawsuit.
A fraud lawsuit is subject to the founder of the bankrupt crypto lender. Insolvent cryptocurrency lender Celsius Network’s creator and former CEO Alex Mashinsky leaves the Manhattan federal court in New York City, United States.
In a report published by U.S News, about a fraud lawsuit, A Manhattan state court judge ordered on Friday that Alex Mashinsky, the creator and former CEO of a now-defunct cryptocurrency lender Celsius Network, must answer to a complaint brought by New York Attorney General Letitia James accusing him of civil fraud lawsuit.
Justice Margaret Chan ruled that the attorney general’s allegations of fraud lawsuit that Mashinsky misled investors by promoting Celsius as a secure alternative to banks and downplaying its hazards, including the possibility of investment losses of hundreds of millions of dollars, were substantial.
Chan said that the “earned interest accounts”and that James might pursue some claims under the Martin Act, a strong state securities legislation of a civil fraud lawsuit.
According to U.S News about the fraud lawsuit, the action brought by the attorney general “supports a reasonable inference that the harm suffered by investors flowed, at least in part, from Mashinsky’s alleged misrepresentations made in New York concerning Celsius’ overall financial health and investment safety,” Chan wrote in a 25-page judgment.
Separately, Mashinsky entered a not-guilty plea to criminal fraud charges/ fraud lawsuit brought by the United States. Justice Department was involved in Celsius’ demise.
The US has also filed related legal fraud lawsuits against him. U.S. Commodity Futures Trading Commission, Securities and Exchange Commission, and U.S. National Consumers League.
Requests for comment from Mashinsky’s attorneys in the New York civil action were not immediately fulfilled.