Former Celsius CEO Alex Mashinsky plans to rely on the same legal team as FTX founder Sam Bankman-Fried in court.
Former Celsius CEO Alex Mashinsky said he was comfortable using the same lawyers as FTX founder Samuel Bankman-Fried to defend him against charges that he pumped up the price of his firm’s cryptocurrency https://t.co/pxxhxKkYZ6
— Bloomberg Crypto (@crypto) February 20, 2024
In January 2023, the New York Attorney General accused Mashinsky of defrauding investors of “billions of dollars.” He was arrested in July.
In the same month, the U.S. Department of Justice filed seven additional criminal charges against the former Celsius head and the platform, including securities fraud, price manipulation of the CEL token, misleading investors, and conspiracy to defraud customers.
Mashinsky pleaded not guilty to all charges. He was later released on a $40 million bail.
During a hearing on February 20, the entrepreneur stated he was willing to waive any potential conflicts of interest arising from the lawyers representing both crypto magnates.
In January, Bankman-Fried hired Mark Mukasey and Torrey Young for representation at sentencing, expected on March 28. In November 2023, the former FTX head was found guilty on seven counts, including fraud and money laundering, facing up to 115 years in prison.
“We cannot predict the future. I assume his sentencing will occur before my trial, but that may not be the case,” Mashinsky stated.
No Serious Conflicts of Interest Found, but Trial Postponed
Prosecutors noted potential conflicts of interest due to the dual representation by the lawyers. Previously, the former Celsius CEO partially blamed the platform’s collapse on the FTX-affiliated hedge fund Alameda Research. Consequently, the use of certain testimonies by the lawyers may be restricted.
Additionally, before his own business collapsed, Bankman-Fried was negotiating to acquire Celsius and replace Mashinsky as CEO during the period between the platform’s withdrawal halt and its bankruptcy filing. In October 2022, FTX considered participating in an auction for the company’s assets.
However, authorities did not deem these issues significant enough to demand the lawyers’ withdrawal.
The entrepreneur acknowledged the existence of certain issues but also did not consider them substantial.
The trial for Mashinsky, initially set for September 17, 2024, has been postponed to January 28, 2025, by mutual agreement.
In September 2023, former Celsius Network executive Roni Cohen-Pavon pleaded guilty to four criminal charges, including fraud and price manipulation.
In the FTX case, former Alameda Research CEO Caroline Ellison, CTO Gary Wang, former chief engineer Nishad Singh, and Bahamas unit head Ryan Salame reached plea deals.
The head of the legal team defending Bankman-Fried stated that there was no chance of winning the case. David Mills described his client as “the worst person he had ever seen on cross-examination.”