Celsius Network faces high scrutiny from the U.S. federal prosecutors
Bankruptcy crypto lending company Celsius Network has been subpoenaed by US federal prosecutors, according to the Financial Times report good on Saturday.
The subpoena — an order for someone to attend court — was issued a few days after Celsius Network froze customer accounts in June by a federal grand jury used by the U.S. Department of Justice in Manhattan. Per Financial Times, the bankrupt crypto firm trapped “the savings of hundreds of thousands of customers.”
according to you today report good On October 11, Cardano (ADA) investors lost over $25 million due to the Celsius freeze. The investor named “Hirokhado Kohji” owned around 60.9 million ADA tokens before the popular crypto lender went bankrupt.
While Celsius is going through the Chapter 11 bankruptcy process, there were reportedly almost 30,000 pages of court documents with the financial information of 600,000 user accounts. The judge, however, allowed revising users’ home addresses with their emails.
According to the Financial Times, Celsius Network has client assets of $25 billion, while “promising clients have given it attractive returns by deploying the token in the digital asset market.”
When Celsius filed for bankruptcy in July, it held around $4.3 billion while owing roughly $5.5 billion, per Financial Times.
According to the Financial Times, the bankrupt crypto lender has held inquiries with several federal agencies, including the Securities and Exchange Commission (SEC), the Commodity Futures Trading Commission (CFTC) and the Federal Trade Commission (FTC).
Withdrawing millions of dollars
According to a report on Oct. 3, Celsius Network founder Alex Mashinsky withdrew around $10 million. The Financial Times report noted that Mashinsky used that money to pay taxes before freezing the customers’ accounts.
A few days later, U.Today informed of That the top executives of Celsius withdrew $30 million worth of miscellaneous crypto assets.
