Vermont Regulator Supports Independent Examiner in Celsius Case

The Vermont state regulator has submitted a filing to the bankruptcy court, showing support for an independent examiner. The filing says that Celsius had not been transparent regarding its financial state.

The Vermont Department of Financial Regulation has made a filing to the United States Bankruptcy Court in the Southern District of New York, offering details on Celsius Network’s insolvency. The filing shows that the department agrees with the issues made by the United States Trustee’s Office. The latter said that the Celsius bankrupt case requires an independent examiner, and filed a motion regarding the same in August 2022.

In a nutshell, the Vermont regulator said that Celsius had not been transparent regarding its financials, and the filing uses blunt language to describe the situation. It says that the company made false and misleading claims and that it was unable to repay investors going back as far as July 2021.

Several state regulators are investigating Celsius’ finances, and the filing notes that the concerns include “potential unregistered securities activity, mismanagement, securities fraud, and market manipulation by Celsius and its principals.” The filing reads,

“During the course of the multistate investigation, it has become clear that Celsius, through its CEO Alex Mashinsky and otherwise, made false and misleading claims to investors about, inter alia, the company’s financial health and its compliance with securities laws, both of which likely induced retail investors to invest in Celsius or to leave their investments in Celsius…”

Celsius may be facing much more trouble

The investigation offers portentous omens for Celsius, which could face similar filings from other state regulators. Further investigations may also show the same support for an independent examiner, and that would not be positive for the company.

Another report said that Celsius CEO Alex Mashinsky took over the company’s trading strategy and that he personally directed individual trades and overruled expert suggestions. The lender has been accused of running a Ponzi scheme, and it has committed to paying back only 22% of customer funds.

CEO Mashinsky also under the microscope

The actions of the company’s CEO are also being investigated. The Vermont state regulator’s filing said that the lender “lacked sufficient assets to repay its obligations,” despite saying that it had enough funds.

The filing pointed to statements made by Mashinsky and company blog posts, which claimed that Celsius was in a healthy financial position and that all funds are safe. The CEO said in May 2022 that the company had “not experienced any significant losses and all funds are safe.”

Notwithstanding the extreme market volatility, Celsius has not experienced any significant losses and all funds are safe.

— Alex Mashinsky (@Mashinsky) May 11, 2022

The post Vermont Regulator Supports Independent Examiner in Celsius Case appeared first on BeInCrypto.

Related Posts

European Parliament members vote in favor of crypto and blockchain tax policies

The resolution recommended authorities in the parliament’s 27 member states consider a “simplified tax treatment” for crypto users involved in occasional or small transactions. Members of the…

If Credit Suisse collapses, will it bring more volatility to the crypto market? Watch The Market Report

On this week’s episode of The Market Report, Cointelegraph’s resident experts discuss the Credit Suisse situation and what impact it would have on the cryptocurrency market if…

Mastercard Debuts Blockchain Surveillance Tool for Banks and Crypto-Centric Card Issuers

On Tuesday, the multinational financial services corporation Mastercard revealed that it is launching a new crypto monitoring product called Crypto Secure. The Crypto Secure software aims to…

Crypto Nomads Start to Settle Down as Threat from Pandemic Subsides and Prices Tumble

Some crypto nomads have decided to settle down following the COVID-19 pandemic, despite the decentralized lifestyle being somewhat conducive to the industry. To investigate the recent phenomenon,…

DeSo: The Answer To Elon Musk and Jack Dorsey’s Call for a Decentralized Social Media?

DeSo, a decentralized social blockchain, recently announced the release of its ambitious roadmap to decentralize social media and build the social layer of Web3. The released roadmap…

Shiba Inu (SHIB) Introduces Canyon HUB For SHIB: The Metaverse

The developer team of SHIB: The Metaverse posted more conceptual black & white artwork for the third upcoming HUB in the Web3 series. The Canyon HUB, as…

Generated by Feedzy