New York Attorney General Letitia James has filed a lawsuit against Alex Mashinsky, alleging the Celsius founder and CEO made numerous “false and misleading statements” which led to investors losing billions. 

In a Jan. 5 announcement, the New York Attorney General’s office announced the lawsuit, which allegedly involved defrauding more than 26,000 residents of the U.S. state out of billions of dollars worth of crypto. According to James, Mashinsky’s actions leading up to Celsius declaring bankruptcy contributed to investor losses by misrepresenting the platform’s financial condition and failing to personally register as required by state law.

“As the former CEO of Celsius, Alex Mashinsky promised to lead investors to financial freedom but led them down a path of financial ruin,” said James. “The law is clear that making false and unsubstantiated promises and misleading investors is illegal. Today, we are taking action on behalf of thousands of New Yorkers who were defrauded by Mr. Mashinsky to recoup their losses.”

I’m suing the former CEO of cryptocurrency platform @CelsiusNetwork for defrauding investors out of billions of dollars.

Alex Mashinsky lied to people about the risks of investing in Celsius, hid its deteriorating financial condition, and failed to register in New York.

— NY AG James (@NewYorkStateAG) January 5, 2023

The lawsuit aimed to ban Mashinsky from “doing business in New York” in the future as well as pay damages, restitution, and disgorgement to affected Celsius investors.

This story is developing and will be updated.