
The U.S. Commodity Futures Trading Commission is likely to take enforcement action against Stephen Ehrlich, the CEO and co-founder of a bankrupt crypto lender Voyager Digital, for misleading customers.
After conducting an investigation into the now-bankrupt crypto firms, investigators at the CFTC concluded that Ehrlich broke derivatives regulations prior to the collapse of the business, Bloomberg reported, citing people familiar with the matter.
The report reflected that staff at the enforcement division of the CFTC recommended suing Ehrlich for breaching the rules by misleading customers about the safety of the company's assets.
The report notes that the CFTC has considered whether to approve the enforcement action against the CEO and co-founder of Voyager Digital.
The CFTC can issue fines and conduct criminal charges against individuals it suspects of wrongdoing, though it has not filed any charges against Ehrlich.
The report said Ehrlich was 'angered and perplexed' by the regulator's potential civil lawsuits, labeling them unfounded.
The co-founder of Voyager Digital said that the cryptocurrency company had worked closely with regulatory authorities while it was still operating and maintained a collaborative relationship with authorities.
Ehrlich added, He added: The economy is booming, and that he expects to be in a better position in the future.
The CFTC's enforcement action could serve as a precedent in terms of responsibility and highlights the need for robust oversight in the crypto lending industry.
Voyager Digital's bankruptcy is a significant event in 2022. It happened when the Crypto empire built by Sam Bankman-Fried collapsed and collapsed.
In July 2022, Voyager Digital filed for bankruptcy and is currently in the middle of a bankruptcy process.