Alexander Mashinsky, the founder of the collapsed crypto lender Celsius, who had already been sentenced to prison for fraud, has now been formally banned from registering with the U.S. Commodity Futures Trading Commission (CFTC).
The actions against the former Celsius CEO, whose firm failed in a widely publicized collapse, now include a permanent prohibition preventing him from doing any business with the CFTC or participating in the commodities markets it oversees.
No additional monetary penalties were imposed by the derivatives regulator. Mashinsky had previously admitted to misleading investors about the financial health of his failing crypto company as it unraveled. The latest order adds a trading and registration ban to his existing punishment, which already includes a 12-year prison sentence, a $50,000 fine, and an order to repay $48 million.
According to court filings, the CFTC order permanently restrains and bars Mashinsky from any involvement in commodities-related activity. The agreement has been entered into the U.S. District Court for the Southern District of New York and was approved by a judge on Thursday.
The CFTC stated that Mashinsky and Celsius “engaged in a scheme to defraud hundreds of thousands of customers” by misrepresenting the safety, profitability, and regulatory compliance of the platform. During the 2022 crypto market downturn, Celsius continued assuring users their funds were safe and earning rewards even as it suffered severe financial losses.
Celsius was among a group of major crypto firms that collapsed in quick succession during that period, deepening the industry-wide crisis.
