Celsius CEO Alex Mashinsky faces investigation by committee

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Celsius CEO Alex Mashinsky faces investigation by committee

The Committee representing customers affected by Celsius bankruptcy has issued a mission statement as it seeks further investigation of CEO Alex Mashinsky for lying to the public.

Unsecured creditors of Celsius formed a group of five individuals and two entities, including Covario AG, a Zug-based crypto prime brokerage, to fight for the speedy recovery of their funds.

The Committee accused Celsius CEO Alex Mashinsky of promoting misleading information before the bankruptcy declaration. Mashinsky, through his public videos and messages, was reportedly promising customers that their funds were safe.

On June 12, his claims proved false when Celsius stopped all withdrawals citing extreme market conditions. He went on to file a Chapter 11 bankruptcy one month later.

The committee has appointed international law firm White Case as its counsel and engaged restructuring advisors M 3 Partners, Perella Weinberg Partners and Elementis to help in the ongoing investigation.

According to the statement:

A cease and desist order was issued by the Department of Financial Protection and Innovation DFPI on August 8, which was issued by the Department of Financial Protection and Innovation on August 8.

The DFPI also accused Celsius of failing to explain that in the case of sudden requests for withdrawals, it may not meet all customer s demands when due, despite the fact that it is accused of misleading information about the risks associated with making deposits in the interest-bearing Earn Program.

The Earn Rewards accounts offered and sold by Celsius are securities in the form of investment contracts and should be registered with securities laws, according to the DFPI.

The DFPI has opened a public complaint form to receive feedback from customers affected by the Celsius withdrawal freeze, as it seeks to speed up the investigation.