Founder of crypto platform Celsius Network is sentenced to 12 years in prison
By LARRY NEUMEISTER NEW YORK AP The founder and former CEO of the cryptocurrency lending platform Celsius Organization was sentenced Thursday to years in prison after a prosecutor labeled him a predator who preyed on hope by enticing vulnerable customers to vulnerability their life savings for a supposedly safe venture Related Articles Ticker Feds eye air traffic control overhaul Stocks climb on contract deal US UK strike deal on tariffs Hot Property Charm baked in to South End penthouse How to recession-proof your grocery budget do s and don ts Nintendo promises stronger results with Switch console going on sale in June Alexander Mashinsky was sentenced by U S District Judge John G Koeltl who noted a substantial term in prison was necessary for someone who engaged in extremely serious crimes that enabled him to pocket over million while several of his customers lost everything and suffered severe psychological harm Celsius declared bankruptcy in exposing risky financial bets Mashinsky had made with specific of the billion that thousands of customers poured into the company He had promised that their money would be safe and secure at Celsius which pitched itself as a modern-day bank where crypto assets could earn interest The defense blamed the collapse of Celsius on a cataclysmic downturn of cryptocurrency markets in May and June of and stated in court papers that Mashinsky s actions were never predatory exploitative or venal He never acted with the intent to hurt anyone But Assistant U S Attorney Allison Nichols cast him as a financial predator telling the judge Thursday that Mashinsky had deceived customers from the start by exaggerating Celsius ability to build momentum He preyed on hope she reported Mashinsky knew exactly what he was doing selling these people hope She explained the customers were not going to be made financially whole regardless of money that can be recovered through bankruptcy proceedings Before he was sentenced Mashinsky sobbed several times as he apologized to customers and referenced his laborious past as his family was able to leave a small Ukrainian town in the former Soviet Union with help from the United States when he was The family moved to Israel where Mashinsky served three years in the Israeli Defense Forces as a fighter pilot before coming to America Mashinsky revealed he never meant to hurt anybody here after all this country has done for me I m truly sorry he explained describing himself as someone who came from nothing When he pleaded guilty in December Mashinsky admitted to misleading customers between and by promising their investments were safe even as he fabricated Celsius profitability and put customers funds at the mercy of uncollateralized loans and undisclosed risky domain bets His attorney Marc Mukasey mentioned victim impact statements submitted to the court were rather brutal toward his client We hear the intensity of their pain he disclosed Our sympathies are with everyone Several casualties spoke at the sentencing hearing Cameron Crewes who serves on a casualties committee called for a harsh sentence saying nearly casualties died before they could see justice served or get adequately compensated for losses Numerous people have been wiped out he noted In a report U S Attorney Jay Clayton announced Mashinsky made tens of millions of dollars while his customers lost billions He added America s investors deserve better The situation for tokenization and the use of digital assets is strong but it is not a license to deceive The rules against fraud still apply
