Celsius Founder Mashinsky Seeks Former Employees to Testify in Fraud Trial

Highlights,A past Celsius CEO currently serving a prison term of over 100 years seeks testimony from six former employees. Such is the case of Mashinsky, who was charged last occurring year for defrauding customers and falsely portraying the financial position of Celsius.,He has asked for these witnesses to be heard in his criminal case. Those supporting this claim, as per a memorandum filed by his attorneys on Friday, include the former CFO and CRO of the company.,Mashinsky’s counsel stressed that he did not seek to do anything harm to anyone.,According to his lawyers:,Celsius has been the subject of regulatory oversight for a great many years; in fact, in 2022 the company declared bankruptcy, while this year it has been completely liquidated. In July 2023, the Securities and Exchange Commission (SEC) sued the crypto lender and its manager, Alex Mashinsky, claiming they appropriated billions of dollars via unlawful cryptocurrency offerings, misrepresentation of Celsius’ health to investors, as well as price fixing of CEL coins.,One of the proposed witnesses is Roni Cohen-Pavon, ex-Chief Revenue Officer of Celsius, who pleaded guilty to counts last year. Cohen-Pavon and other company employees ignored the instructions of Mashinsky and attempted to sell CEL tokens through repurchase while buying more instead of selling.,American prosecutors have shown evidence that Mashinsky and Cohen-Pavon planned together how to increase the price of CEL before selling them.,Mashinsky’s lawyers added:,According to Alex Mashinsky’s lawyers, during the weekly “Ask Mashinsky Anything” live events, Celsius’s legal and risk teams edited the content without notifying him. Celsius’ legal, risk, and regulatory teams reviewed transcripts of the AMA sessions before posting them, according to his defense.,As per the lawyers, Mashinsky had every reason to believe any inaccuracies in his public statements would be corrected. Mashinsky accepted the corrections, showing good faith rather than fraud, they claim.,However, the defense also stated that these corrections were almost always made without Mashinsky’s knowledge.,Also, the Celsius Network Litigation Administrator filed a lawsuit in the United States Bankruptcy Court for the Southern District of New York in July. The complaints were directed at a group of Celsius account holders who had allegedly received “preferential transfers.”,This group included those with more than $100,000 in Withdrawal Preference Exposure (WPE) who had not settled their preference liabilities. The filing named over 1,300 individuals and entities worldwide, including investment funds and companies,