Key facts
- Celsius co-founders Shlomi Daniel Leon and Hanoch Goldstein will pay over $6 million to settle FTC charges.
- Goldstein is ordered to pay $2.014 million, and Leon is ordered to pay $4.1 million.
- The FTC alleged the co-founders misrepresented the safety of Celsius's platform before its collapse.
- Both co-founders are banned from marketing or selling cryptocurrency-related products or services.
- Former CEO Alex Mashinsky previously settled with the FTC for $10 million and faces 12 years in prison.
Celsius co-founders Shlomi Daniel Leon and Hanoch Goldstein have agreed to pay over $6 million in settlements to resolve Federal Trade Commission allegations that they misled customers about the safety of the crypto lending platform before its collapse. Goldstein, the former chief technology officer, will pay $2.014 million, while Leon, the former chief strategy officer, will pay $4.1 million, according to court orders.
The settlements add to the legal repercussions for the company, which held $25 billion in assets at its peak but owed users $4.7 billion when it filed for bankruptcy in July 2022. The FTC accused Celsius executives of falsely assuring customers about sufficient reserves to meet withdrawal demands and the absence of unsecured loans, even days before the bankruptcy filing.
These payments will be credited against a larger $4.72 billion judgment against the company. Separately, former CEO Alex Mashinsky settled with the FTC in April for $10 million and faces a 12-year prison sentence after pleading guilty to fraud charges related to misleading customers about the company's financial health and the safety of their funds.