Judge Orders Freeze on Former Celsius CEO Alex Mashinsky’s Assets Amid Ongoing Legal Battle

In the legal case against former Celsius CEO Alex Mashinsky, a judge has ordered the freezing of several bank accounts and a residential property owned by Mashinsky. 

The decision, revealed in newly unsealed court documents, follows Mashinsky’s arrest in July on multiple charges, including securities fraud, related to his alleged involvement in defrauding Celsius investors.

In a quiet but significant move, Judge Jed Rakoff initially issued an order on August 16 that prevented financial institutions from selling assets held in specific Goldman Sachs accounts linked to Mashinsky.

The court order also included a freeze on a residential property connected to the embattled cryptocurrency mogul in Austin, Texas.

The decision to initially seal the asset freeze was made to prevent preemptive efforts to empty the affected accounts. However, this week, Judge Rakoff decided to make his ruling public.

The asset freeze restricts Mashinsky’s access to his savings and real estate assets at a critical time when he requires liquidity to fund his legal defense.

Following his arrest on July 13, Mashinsky was released on a $40 million bond and pleaded not guilty to multiple charges, including allegations of multibillion-dollar fraud and market manipulation schemes.

Prosecutors allege that Mashinsky misrepresented Celsius as a secure platform for crypto deposits and interest earnings while allegedly operating a risky investment fund and providing false information about its financial status.

Charges and Ongoing Legal Battle

The Department of Justice (DOJ) indictment against Alex Mashinsky also accuses him of making false public statements regarding the sales of CEL, Celsius’s native token.

If convicted on multiple fraud counts, Mashinsky and Celsius executive Roni Cohen-Pavon could face significant prison sentences.

Mashinsky and his legal team vehemently deny the charges, describing them as “baseless.”

Regulatory Scrutiny Continues

Regulators have raised concerns about Celsius’s CEL token and Earn product, alleging that they constituted unregistered securities sold to retail customers without proper authorization.

Multiple government agencies, including the SEC, CFTC, and FTC, have filed lawsuits against Mashinsky and are conducting ongoing investigations into Celsius.

For now, Mashinsky must contend with the legal battle without access to his frozen assets.

The asset freeze, secured by Judge Rakoff, ensures that the government can pursue potential fines and restitution if the former cryptocurrency billionaire is ultimately convicted.

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