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Former Celsius CEO Alex Mashinsky’s Assets Frozen by Court Order

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Former Celsius CEO Alex Mashinsky's Assets Frozen by Court Order Amid Legal Probe
Former Celsius CEO Alex Mashinsky's Assets Frozen by Court Order Amid Legal Probe

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A court ordered the freezing of several bank accounts and properties owned by former Celsius CEO Alex Mashinsky, who faces seven charges of fraud.

A Sept. 5 court filing ordered the freezing of Mashinsky’s accounts at institutions including Goldman Sachs and Merrill Lynch. The now unsealed order was initially kept secret due to concerns that the accounts could be emptied before they were frozen. 

The former CEO’s home in Austin, Texas, was also restrained under the court’s directive. The property had already been listed for sale through Zillow for about $2.49 million.

Cryptocurrency lender Celsius filed for bankruptcy in July 2022 after revealing its liabilities exceeded assets by $1.2 billion.

Celsius Co-Founder Faces Criminal Charges

The asset freeze comes as Mashinsky faces criminal charges for allegedly defrauding Celsius investors. In July, federal authorities arrested and charged him with fraud. They alleged that he deceived investors about Celsius’ financial stability and engaged in risky trading practices. 

He was also accused of selling securities that weren’t properly registered, misleading investors, and falsely presenting the company as a secure alternative to traditional banking, all while personally profiting about $42 million from alleged price manipulation of Celsius’ native digital currency, CEL. 

Commodity Futures Trading Commission (CFTC) and the Securities and Exchange Commission filed civil lawsuits against Mashinsky. 

As the bankruptcy case gained momentum, the Federal Trade Commission decided to postpone a $4.7 billion fine imposed on the company, as these funds were intended to be used to settle claims from creditors.

Prosecution Gathers Evidence

Mashinsky was granted bail at a sum of $40 million after he pleaded not guilty to what his lawyers describe as “baseless” charges. The prosecution requested six to eight weeks to assemble evidence for their case.

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