The former chief revenue officer of Celsius, Roni Cohen-Pavon, has admitted guilt on all four counts and will be released on bail until a sentencing hearing on December 11.
According to court documents, Roni Cohen-Pavon, 36, a former executive at Alex Mashinsky's insolvent cryptocurrency loan platform Celsius Network, has admitted guilt to four criminal charges.
Due to charges of wire fraud and market manipulation of security in the CEL token, Cohen-Pavon could spend a total of 65 years behind bars.
Cohen-Pavon will also have to pay restitution in a sum determined by the court, in addition to his prison sentence.
On December 11, 2024, he will be sentenced in front of Manhattan's U.S. District Judge John Koeltl. Until then, he will remain free on bond.
The Southern District of New York's U.S. Attorney's Office has accepted Cohen-Pavon's guilty plea, according to court documents.
Additionally, the U.S. Attorney and Cohen-Pavon came to an agreement for Cohen-Pavon's assistance in the Mashinsky case, with the stipulation that "no testimony or other information given by the defendant will be used against him in any criminal tax prosecution." Judge Koeltl may be advised by the prosecution to consider Cohen-Pavon's aid while determining his sentence.
Charges against the two former Celsius executives were revealed by the U.S. Justice Department in July, although Cohen-Pavon's whereabouts as an Israeli resident were largely unknown at the time. Mashinsky entered a not-guilty plea to all counts and was out on a $40 million bond at the time of publication.
A federal judge approved the freezing of some of Mashinsky's assets, including several bank accounts and a property in Austin, Texas, during the legal processes. The former Celsius CEO's attorneys submitted a request on September 11 asking for the FTC lawsuit against him to be dismissed on the grounds that the charges do not qualify as a claim.
At the time of publication, the bankruptcy case for Celsius Network, which was filed in July 2022, was still active. A bankruptcy court will hear a settlement proposal made in August in October.
Due to the COVID-19 pandemic's spike in cryptocurrency values, cryptocurrency lenders like Celsius expanded quickly. Then, in an effort to profit from the discrepancy, they lent tokens to institutional investors after promising depositors quick access to loans and exorbitant interest rates.
As cryptocurrency prices dropped, Celsius disintegrated amidst a frenzy of customer withdrawals. As prices crashed while interest rates rose, it was one of the first of several cryptocurrency bankruptcies, including the FTX exchange.
Other cryptocurrency entrepreneurs have also been accused of fraud by Williams' office, including Sam Bankman-Fried, the founder of FTX, who has pled not guilty and will go on trial on October 3.
In accordance with the terms of Cohen-Pavon's plea deal, the prosecution may suggest that Koeltl consider Cohen-Pavon's aid when imposing a sentence on December 11, 2024.