On Thursday, the former CEO of Celsius Network, Alex Mashinsky had been arrested and charged with fraud.
According to the latest news, the ex-CEO of the bankrupt crypto lender will now be released on bail.
The deal
Court documents have revealed that he has agreed to a personal recognizance bond worth $40 million and a deadline of July 14th, Friday, has been given for his wife to sign it.
Another financially responsible individual, who has not been identified as yet, would also be required to sign it before July 21st.
The deal dictates that Mashinsky would also have to give the authorities his travel documents and he would not be able to go anywhere beyond New York.
Furthermore, the former CEO of the crypto lender is not permitted to establish any new personal or business bank accounts, crypto accounts, or lines of credit, until Pretrial Services grant their approval.
A kind of bail agreement that enables the defendant to secure a release without paying any money in bail is referred to as a personal recognizance bond.
Due to their personal recognizance, they are released from custody and promise to attend all court proceedings and hearings pertaining to their case.
Recognizance bonds
People with strong ties to the community and are at low-flight risks are usually granted these recognizance bonds.
In order to determine if an individual should be granted a recognizance bond or not, a number of factors regarding the defendant are considered.
These factors include family obligations, employment status as well as criminal history. But, if the defendant would have to deal with additional charges if they do not make an appearance in court.
Moreover, the bond or bail amount that would have been needed is also forfeited. As far as Mashinsky is concerned, a bank account and a financial claim on his residence in New York City is used for securing the bond.
Accusation denied
The 57-year-old Mashinsky was arrested on Thursday by the Department of Justice (DOJ) in the US and a number of criminal charges were filed against him, including commodities fraud, wire fraud, and securities fraud.
The chief revenue officer, Roni Cohen-Pavon, and Mashinsky, both were charged with price manipulation of CEL, the native token of the platform.
On Thursday, a special agent of the New York Field Office’s Criminal Division, Michael A. Brodack, spoke at a press conference and said that Mashinskly had made $40 million in returns.
However, the former CEO pled not guilty to the said charges. Jonathan Ohring, the lawyer representing Mashinsky, said that the charges were baseless and the entrepreneur was going to defend himself.
A lawsuit was also filed by the US Securities and Exchange Commission (SEC) against Celsius and Mahsinsky for selling unregistered crypto securities to raise billions of dollars.
They have also been accused of deceiving investors about the financial condition of the company. Likewise, the Federal Trade Commission (FTC) also filed lawsuits against Celsius for duping customers.
Celsius and Mashinsky were also charged by the Commodity Futures Trading Commission (CFTC) with fraud.
All lawsuits were filed against Celsius Network on Thursday, a year after the crypto lender had filed for bankruptcy.