Celsius Co-Founders Leon, Goldstein Settle With FTC

Celsius co-founders Daniel Leon and Shзки Goldstein have agreed to pay over $6 million to settle charges brought by the U.S. Federal Trade Commission (FTC). The FTC accused the executives of misleading investors about the risks associated with Celsius Network's cryptocurrency lending products. This settlement resolves allegations that Leon and Goldstein, along with former CEO Alex Mashinsky, misrepresented the safety and profitability of the company's investment offerings.

In April, Alex Mashinsky, the former CEO of Celsius, agreed to a separate $10 million settlement with the FTC to resolve similar allegations. The FTC's complaint, filed in July 2023, detailed how Celsius and its executives allegedly deceived customers by claiming the company was a safe and reliable platform for earning high yields on their crypto assets. The agency stated that the company actually engaged in risky investments and commingled customer funds, leading to significant losses for investors when the company collapsed.

The FTC's actions aim to provide some restitution to the victims of Celsius's alleged fraudulent activities. The settlements with Leon and Goldstein, totaling over $6 million, are part of the ongoing effort to hold the leadership accountable for the company's downfall. The FTC's investigation highlighted a pattern of deceptive practices designed to attract and retain customer deposits while concealing the true financial health and operational risks of Celsius Network. The agency emphasized that these settlements are subject to court approval.