March 27, 2024
Alex Mashinsky seeks complete dismissal of FTC's case against him
Latest Cryptocurrency News

Founder Alex Mashinsky Fights FTC Allegations in Bid for Dismissal

Alex Mashinsky, the founder and former CEO of the now-bankrupt crypto lender Celsius, has submitted a fresh legal motion, aiming to have the United States Federal Trade Commission’s case against him “completely dismissed.”

The legal representation for the former Celsius chief contended that the allegations against their client lack the necessary substance to assert that he knowingly made a false statement with the intention of fraudulently acquiring customer information from a financial institution. According to the legal team, the accusations fail to meet the criteria for a claim under the Gramm-Leach-Bliley Act, a law from 1999 that requires the dissemination of false information to deceitfully obtain customer data from a financial institution.

Furthermore, the legal representatives asserted that Mashinsky’s resignation from his role as CEO of Celsius on September 27, 2023, renders the complaint unable to establish that he is currently violating or is on the verge of violating the law.

In July, the FTC imposed a substantial fine of $4.7 billion on the now-bankrupt crypto lender Celsius Network and filed a lawsuit against Alex Mashinsky, along with Celsius’ co-founders, Shlomi Daniel Leon and Hanoch Nuke Goldstein. Mashinsky’s legal team also represented Goldstein, and they argued that the FTC’s case against Goldstein seems to rest solely on the fact that he retweeted a Celsius blog post. Goldstein, according to his legal team, believes that this action is being misinterpreted as evidence of complicity or involvement in the alleged wrongdoing.

Celsius, under the leadership of Mashinsky, was once one of the largest crypto-lending platforms until it collapsed in 2022. Mashinsky resigned from his CEO position in September of the same year, and by the end of 2022, the United States Justice Department had indicted him on numerous criminal fraud charges. Mashinsky has entered a plea of not guilty to the multiple charges filed against him and is currently free on bail, secured by a $40 million bond.

Image by freepik

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