Bankrupt crypto lender Celsius and its former CEO, Alex Mashinsky, have been found to have violated multiple United States regulations by investigators from the Commodity Futures Trading Commission (CFTC).
This revelation comes in the wake of the company’s collapse in 2022.
According to Bloomberg’s report on July 5, citing individuals familiar with the matter, the CFTC’s enforcement division attorneys discovered that Celsius engaged in misleading practices towards investors and failed to register with the regulatory body.
Additionally, Alex Mashinsky was found to have broken several regulations.
Should the majority of the CFTC commissioners concur with the investigators’ findings, the agency may initiate legal action against the defunct crypto lender in U.S. federal court as early as this month, as per insider sources.
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The CFTC investigators’ conclusions contribute to the growing list of regulatory actions taken against the now-defunct crypto lending platform.
On January 5, the New York Attorney General sued Mashinsky, accusing him of deceiving investors and causing substantial financial losses.
On June 16, 2022, securities regulators from five U.S. states launched an investigation into Celsius just three days after the sudden suspension of user withdrawals on June 13.
Court filings indicate that the Securities and Exchange Commission (SEC) and federal prosecutors from Manhattan have also commenced inquiries into the company.
However, Bloomberg highlights that both the SEC and the U.S. Attorney’s Office for the Southern District of New York have refrained from commenting on the investigations’ progress.
Cointelegraph reached out to both the CFTC and Alex Mashinsky for a response but did not receive any communication at the time of writing.
