Crypto Lender Celsius Fined $4.7 Billion And Banned From Trading By FTC
Crypto lender platform Celcius Network which was bankrupted last year is now permanently banned from trading by the US trade regulators. In addition, the cryptocurrency platform was also fined a hefty amount of $4.7 billion by the FTC.
Available information also suggests that 3 top executives (former) are charged by the FTC in relation to the transfer of digital tokens on the platform.
If we look back, the Celsius network suspended the transfers and withdrawals for its customers before filing for bankruptcy. At that time, the crypto platform said this was important due to the extreme market conditions.
Celcius Made False Promises
According to the US FTC, the Celsius Network deceived its user base by making false promises that they could withdraw their funds at any time. In addition, the company also failed to maintain enough reserves to maintain the insurance policy for the deposits present in the exchange.
Another charge on the Celcius network is that it made false claims about offering up to 18% returns on deposits made by users.
The director for the FTC also stated how the Celsius network presented a new business model while engaging in fraudulent activities.
Now that the FTC has proposed new restrictions on Celcius, the company and anyone affiliated with it will be banned from offering any services related to trading (deposit, investment, exchange, or withdrawal activities).
At the same time, the former executives of the company didn't agree to the settlement. This means the case against them made by the FTC will now move to the federal court.
The recent FTC announcement comes at a time when the Celcius former CEO and co-founder 'Mashinsky' was arrested on fraud charges. As per the available details, Mashinsky and one other company executive are facing 11 criminal charges.
For the most part, this move by the FTC tells us that the US authorities are going hard against the crypto community & will ensure full compliance.