- Former Celsius CEO Alex Mashinsky is seeking testimony from six ex-employees as he faces the potential of an extensive prison sentence.
- Mashinsky was arrested on allegations of defrauding customers and misleading them about the company’s profitability.
- His defense requests the involvement of key former executives to testify at his trial, citing that many reside outside the U.S.
Ex-Celsius CEO Alex Mashinsky Seeks Testimony from Key Former Executives Amid Fraud Trial
Mashinsky’s Legal Battle Intensifies with Key Witness Testimonies
In a recent memorandum, the legal team for Alex Mashinsky, the former CEO of Celsius, petitioned a New York district court to allow testimonies from six former executives of the now-bankrupt crypto lender. These witnesses, ranging from the firm’s previous chief financial officer to its chief revenue officer, are deemed pivotal for Mashinsky’s defense in the trial where he potentially faces a prison term exceeding 100 years.
Background on Charges and Allegations
Mashinsky’s arrest in 2022 followed accusations from federal prosecutors that he deceived customers about Celsius’ financial health and engaged in misleading activities. Celsius, which filed for bankruptcy last year, has been under intense scrutiny from various regulators, including the Securities and Exchange Commission (SEC). In July 2023, the SEC charged both Mashinsky and Celsius with fraudulent and unregistered sales of cryptocurrency, along with the manipulation of the company’s native token, CEL.
Key Witnesses Highlight Trial Dynamics
The list of proposed witnesses includes ex-Celsius Chief Revenue Officer Roni Cohen-Pavon, who admitted guilt to criminal charges last year. According to Mashinsky’s attorneys, Cohen-Pavon and other executives disregarded Mashinsky’s directives regarding CEL token transactions, instead opting to buy more tokens in secret. The prosecution claims both Mashinsky and Cohen-Pavon artificially inflated CEL’s price by purchasing millions of dollars’ worth of the token, subsequently selling them at a profit.
Mashinsky’s legal team argues that Cohen-Pavon’s testimony is crucial due to his involvement in advising Celsius on CEL token dealings from 2019 to 2022. The defense maintains that Mashinsky’s actions were based on information provided by an experienced team and any public misstatements were unintended, as they went through a rigorous review process by the firm’s legal and risk departments.
Claims of Unintentional Misstatements and Internal Processes
During his tenure, Mashinsky hosted regular “Ask Mashinsky Anything” webinars to update Celsius customers. His defense claims these sessions were reviewed by the company’s legal and risk teams, but the feedback was often withheld from Mashinsky, resulting in inadvertent inaccuracies. The memorandum asserts that when Mashinsky was informed of any errors, he addressed them immediately, which his defense considers evidence of his good faith.
Conclusion
As the trial progresses, Mashinsky’s request to include testimony from former Celsius executives could play a critical role in the outcome. His defense is positioning him as a CEO who acted on the expertise of his team, rather than a perpetrator of fraud. The court’s decision on whether to include these testimonies will significantly impact the trial dynamics and the potential 115-year sentence looming over Mashinsky.
