Former Celsius CEO Mashinsky Barred by U.S. CFTC in Final Regulatory Settlement

Alexander Mashinsky, founder of the collapsed crypto lending platform Celsius, who was previously sentenced to prison for fraud, has now been formally barred from registering with the U.S. Commodity Futures Trading Commission (CFTC).

The penalties against Mashinsky, the former CEO of Celsius before its widely publicized failure, continue with an official prohibition preventing him from engaging in any business activities involving the CFTC or the commodities markets it regulates.

The derivatives regulator did not impose additional financial penalties on Mashinsky, who had already admitted to misleading investors about the condition of his struggling crypto firm as it unraveled. Instead, the agency added a registration and trading ban, according to a Thursday announcement. This comes on top of his earlier criminal sentence, which included 12 years in prison, a $50,000 fine, and an order to forfeit $48 million.

The CFTC’s order, which permanently restricts, bars, and prevents him from participating in any commodities-related activities, has been entered into the U.S. District Court for the Southern District of New York and approved by a judge, according to court records.

In its statement, the CFTC said Mashinsky and Celsius “engaged in a scheme to defraud hundreds of thousands of customers” by falsely portraying the safety, profitability, and regulatory compliance of the Celsius digital asset platform. During the broader crypto market collapse in 2022, the firm continued assuring customers their funds were secure and generating rewards, even as it suffered major losses.

Celsius was one of several major crypto firms that failed in close succession during that period, intensifying the overall market turmoil.

Read More: Celsius Founder Alex Mashinsky Sentenced to 12 Years in Prison for Fraud