As an analyst with a background in finance and experience in following the digital asset market, I find this development deeply troubling. The $50 million settlement between Gemini and the New York Attorney General’s Office is just one more instance of investors being defrauded in the rapidly evolving and often unregulated world of cryptocurrencies.
The New York Attorney General’s Office and Gemini have reached a $50 million settlement. Under the terms of this agreement, Gemini will provide compensation to users who were unfairly denied access to their deposited assets in the Gemini Earn program. With this resolution, the lawsuit filed against Gemini in October 2023 comes to a close.
Letitia James, New York’s Attorney General, announced in a statement, “Over 29,000 New Yorkers, among hundreds of thousands of people, had their trust violated and their funds misappropriated through Gemini’s deceptive Earn program.” She added, “Gemini advertised its Earn scheme as an opportunity for investors to expand their wealth. However, they falsely represented the situation and prevented investors from accessing their accounts. This settlement aims to restore losses for defrauded investors, serving as a warning to cryptocurrency platforms that deceiving investors is unlawful and will be met with stern action by my office.”
Gemini has agreed to return defrauded investors all their assets within seven days by depositing them into their respective accounts. Investors can log back into the platform to access their funds. The program affected 230,000 users, including those living within and outside New York state. The company has also agreed not to operate any lending program in the state.
The crux of the legal action hinges on Gemini allegedly deceiving investors regarding the risks associated with the Earn program, resulting in an unjust taking of their funds when the assets became unreachable. Notably, Letitia James previously filed a $2 billion lawsuit against Genesis Capital Group for involvement in the same investment scheme.
As a researcher, I would put it this way: I must collaborate with the Office of the New York Attorney General in their ongoing case against Digital Currency Group (DCG), its CEO Barry Silbert, and its former CEO Soichiro Moro. New York Attorney General Letitia James has earned a notable reputation for pursuing justice on behalf of investors who have been victimized by fraudulent digital asset businesses.
In 2022, KuCoin agreed to pay her a settlement of $22 million due to its unlicensed operation in the state. Additionally, she and Nexo obtained $24 million from them for their illegal activities. Her upcoming major litigation is against Alex Mashinsky, the former founder of Celsius, which will commence in January 2025.
Image by Sergei Tokmakov, Esq. https://Terms.Law from Pixabay
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2024-06-16 21:07