Celsius

<div class="insidebitcoins">
 <p class="text__text__1FZLe text__dark-grey__3Ml43 text__regular__2N1Xr text__small__1kGq2 body__full_width__ekUdw body__small_body__2vQyf article-body__paragraph__2-BtD" data-testid="paragraph-0">Two US regulators filed lawsuits against Voyager Digital founder Stephen Ehrlich accusing him of misleading customers about their assets and taking ”excessive risks” that brought the firm down.</p>
 <p data-testid="paragraph-0">The US Commodity Futures Trading Commission (CFTC) accuses&nbsp;the trading firm and Ehrlich of fraud, registration failure, and operating an unregistered commodity pool.</p>
 <p>The Federal Trade Commission (FTC) filed a parallel lawsuit against Ehrlich, accusing him of falsely claiming that Voyager accounts are insured by the Federal Deposit Insurance Corporation (FDIC).</p>
 <p>It also accuses Ehrlich of allegedly transferring millions of dollars in funds belonging to Voyager</p>
 <p>CFTC commissioner Kristin Johnson said the bankrupt crypto firm promised a “safe haven” to its customers but instead approved risky loans at the expense of customer assets.</p>
 <blockquote class="twitter-tweet" data-width="550" data-dnt="true">
  <p lang="en" dir="ltr">Statement of @CFTCjohnson regarding @cftc's charges against Voyager's chief executive officer. Learn more: https://t.co/OiBvOoCuV6</p>
  <p>— CFTC (@CFTC) October 12, 2023</p>
 </blockquote>
 <p></p>
 <p>“Voyager conducted bare-bones due diligence and then seemingly ignored the results of that process even when counterparties failed to return the minimal materials they requested,” Johnson said.&nbsp;“The company became no better than a house of cards.”</p>
 <p>The CFTC’s director of enforcement, Ian McGinley, accused Voyager of misleading customers. The platform claimed it would treat customer assets safely but instead took reckless risks using these assets.</p>
 <h2 id="voyager-digital-hid-information-from-customers">Voyager Digital Hid Information From Customers</h2>
 <p>Johnson said that Voyager hid information from its customers. In one case, a counterparty defaulted in repaying a Voyager loan of around $650 million but the firm’ failed to mention it to customers.</p>
 <p>Ehrlich concealed Voyager’s poor financial position from customers. Instead, the broker continued soliciting more deposits from new and existing customers. The fresh deposits went towards meeting withdrawals.</p>
 <p>Johnson said that Voyager did not demand transparency from the investment firms receiving customer assets. It also never sought audited financial statements from these companies.</p>
 <h2 id="ftc-reaches-a-settlement-with-voyager-digital">FTC Reaches A Settlement With Voyager Digital</h2>
 <p>The FTC also reached a settlement deal with the bankrupt crypto firm. Under the proposed settlement, the FTC bars Voyager and its affiliates from handling customer assets. Voyager and its affiliates will also pay a $1.65 billion fee as part of the settlement.</p>
 <blockquote class="twitter-tweet" data-width="550" data-dnt="true">
  <p lang="en" dir="ltr">FTC reaches settlement with crypto company Voyager Digital; Charges former executive with falsely claiming consumers’ deposits were insured by FDIC: https://t.co/Kgz368Hbrk /1</p>
  <p>— FTC (@FTC) October 12, 2023</p>
 </blockquote>
 <p></p>
 <h3 id="related-articles">Related Articles</h3>
 <ul>
  <li>Celsius Founder Alex Mashinsky Wants FTC Case Dismissed</li>
  <li>Coinbase CEO Brian Armstrong Urges DeFi Companies to Sue CFTC</li>
  <li>Binance and Changpeng Zhao Want CFTC Lawsuit Dismissed</li>
 </ul>
 <p>Source: <a rel="noopener noreferrer nofollow" target="_blank" href="https://thebittimes.com/us-regulators-sue-voyager-digital-one-says-it-was-a-house-of-cards-tbt66285.html">https://thebittimes.com/us-regulators-sue-voyager-digital-one-says-it-was-a-house-of-cards-tbt66285.html</a></p>
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US Regulators Sue Voyager Digital, One Says It Was ”A House Of Cards”

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TheBitTimes

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