Celsius Used New Customer Funds to Pay for Withdrawals: Independent Examiner

Celsius misled its investors – and on occasion used new customer funds to pay for other customers’ withdrawals, the usual definition of a Ponzi scheme, an independent examiner for the New York bankruptcy court said in a Tuesday filing.

In September, Shoba Pillay was asked by the court to offer an outside view of goings-on at the crypto lender, has now published an account of the firm’s operations in the run up to bankruptcy being declared in July.

“In every key respect—from how Celsius described its contract with its customers to the risks it took with their crypto assets—how Celsius ran its business differed significantly from what Celsius told its customers,” Pillay wrote, after interviewing staffers, including former chief Executive Officer Alex Mashinsky, as well as customers of and vendors to the company.

Source: Celsius Used New Customer Funds to Pay for Withdrawals: Independent Examiner