A recent development in the legal saga surrounding former Celsius CEO Alex Mashinsky has seen a federal judge issue an order to freeze specific bank accounts and properties associated with him, following a motion from the United States Justice Department.
This judicial decision, dated September 5 and emanating from the U.S. District Court for the Southern District of New York, has approved the unsealing of a restraining order pertaining to Mashinsky’s assets.
Under this order, the Justice Department has been granted the authority to freeze accounts held under the names of various holding companies at Goldman Sachs and Merrill Lynch, in addition to accounts registered under Mashinsky’s own name at First Republic Securities, SoFi Bank, and SoFi Securities.
Notably, the order extends to include a property owned by Alex Mashinsky and his wife, Kristine, situated in Austin, Texas.
The Mashinskys acquired this residence in 2021, and it had been on the market for over a year, a period coinciding with Celsius’s filing for bankruptcy in July 2022.
This Austin property has garnered attention as it is being sold by Alex Mashinsky, the co-founder and former CEO of the cryptocurrency lending platform, Celsius, which declared bankruptcy.
Mashinsky cited his resignation in September 2022, asserting that his role had become a significant distraction, particularly amidst the backdrop of Celsius users grappling with “difficult financial circumstances.”
Even prior to this development, Celsius had been under scrutiny by both state and federal authorities for purportedly offering unregistered securities.
The legal entanglements intensified in July when U.S. authorities arrested Mashinsky, alleging that he had deceived Celsius investors and defrauded users of substantial sums.
Mashinsky pleaded not guilty to all charges and was subsequently released on $40 million bail, with certain restrictions such as electronic monitoring and stringent financial transaction controls in place.
In a parallel legal course, the U.S. Commodity Futures Trading Commission and the Securities and Exchange Commission initiated civil cases against Mashinsky in July, ultimately reaching settlements with Celsius amidst the backdrop of the former CEO facing criminal and civil charges.
Furthermore, the Federal Trade Commission imposed substantial fines amounting to $4.7 billion on Celsius for alleged misconduct in “duping” its users.
However, these penalties were temporarily suspended to facilitate the use of assets in the context of Celsius’s ongoing bankruptcy proceedings.
Other Stories:
Micro Bitcoin Mining Devices: Embracing Transparency and Community Over Profits
Japanese Financial Regulator FSA Proposes Tax Code Overhaul for Crypto Assets
Legal Industry Rakes in Over $700 Million from Cryptocurrency Bankruptcies
