Celsius was sued by former investment manager Jason Stone on Thursday as pressure on the firm continues to mount amid the collapse in cryptocurrency prices. Stone claimed, among other things, that Celsius CEO Alex Mashinsky (above) had “enriched himself greatly.”
Piaras Ó Midheach | Sports file for Web Summit | Getty Images
Distressed lending platform Celsius has pulled back a bid to bring back the former CFO Rod Bolger $92,000 per month for at least six weeks, according to a court document It was filed Friday in the Southern District of New York. The removal notice came shortly before a hearing scheduled for Monday to review it.
While Bolger worked full-time as the company’s CFO, shows the original movement in addition to his $750,000 base salary and stock and token options, he has a performance-based cash bonus of up to 75% of his base, bringing the top end of his total income range to about $1.3 million, he said. The filing also indicates that Bolger is technically still on the company’s payroll.
“On June 30, 2022, Mr. Bolger notified the Debtors that he had voluntarily terminated his employment.” reads the document. “Pursuant to the terms of his Notice of Resignation and Employment Agreement (as set out below), Mr. Bolger is required to give the Debtors eight weeks’ notice, which he has done, and that he continues to work as a Customer Service Officer. Debtors.”
If the petition were to be approved, it’s unclear whether Bolger could receive compensation of $62,500 (his monthly base salary) in addition to the $92,000 monthly consulting fee Celsi is seeking. The filing states that he continues to serve as a Celsius employee, but states that Bolger “is not entitled to any severance pay.”
CNBC reached out to Selsey to ask about the terms of the proposed move, but he did not immediately respond to a request for comment outside of business hours.
The decision to deny the petition was made three days later CNBC first reported the survey to enlist Bolger’s assistance as counsel in the bankruptcy proceedings. He is also a formal objection submitted by Keith Suckno, a CPA and Celsius investor, challenged the move by Celsius, arguing that Bolger’s services were given “small details” about why they were needed for the bankruptcy proceedings.
In the original act, Celsius said it needed Bolger to assist in the bankruptcy process as a bankrupt “because of Mr. Bolger’s familiarity with the Debtors’ business.” Later in Bolger’s tenure, he led efforts to stabilize the business during this year of market volatility, led the financial aspects of the business and acted as a company leader.
Bolger, a Former CFO of Royal Bank of Canada and Bank of America divisionsHe was with Selsey for five months before resigning on June 30, about three weeks later. the platform has stopped all withdrawals.
Suckno challenged Bolger’s reinstatement to preside over the bankruptcy proceedings, arguing that Bolger “misrepresented the financial condition and liquidity” of Celsius. “Meet Rod Bolger, Chief Financial Officer, Selsey” has been published five days before the platform freezes withdrawal due to “extreme market conditions”.
In the article, also reviewed by CNBC, Bolger said in a print interview that Celsius’ “robust liquidity framework, practices and modeling built around liquidity data” are similar to other major financial institutions.
“This has put us in a strong position to weather the recent market turbulence and ensure that customers who want access to their digital assets can access them free and clear.” Celsius followed up on Bolger’s quote in a blog post. The following Monday, the platform stopped all withdrawals and transfers.
Meanwhile, two days after this blog post — and three days before Celsius froze customer funds on the platform — Bolger was on Celsius’ weekly Ask Me Anything show on YouTubesaid the company welcomed the arrangement.
“We believe in transparency. Blockchain is about transparency. We are transparent. You know, my goal is for us to be regulated everywhere,” Bolger said in the video.
“We’ve voluntarily disclosed a lot of financial information. My goal is to continue building tools — even before we’re regulated and/or made public and required to do so. Like Basel… These are basically the standards that banks operate under,” Bolger continued, adding that Celsi already assesses market risk and operational risk so they can “continue to build a level of public confidence.”
The video was released on Friday, June 10, and the following Monday, June 13, Celsius closed ramps opening and closing user funds. Celsius owes its users about $4.7 billion. according to the bankruptcy filing.
CNBC sent multiple requests to Bolger on two different platforms, but did not immediately respond for comment.
After Bolger stepped down as CFO, Celsi appointed Chris Ferraro, who later served as head of financial planning, analysis and investor relations for Celsius. A few days after his appointment, the company filed for bankruptcy protection.
Celsius, once a titan of the cryptocurrency world, is now on its toes It claims to be working with a Ponzi scheme by paying early depositors with money it receives from new users.
At its peak in October 2021, CEO Alex Mashinsky said the crypto lender had $25 billion in assets under management. Celsius is low now $167 million “in cash” said it would provide “substantial liquidity” to support operations during the restructuring process.
The filing also reveals that Celsius has more than 100,000 creditors, some of whom are lending the platform cash without any collateral to support the arrangement. The top 50 unsecured lenders list includes Sam Bankman-Fried’s trading firm Alameda Research.
There are retail investors appealed to the judge helping them recover some of their lost wealth, some say effectively wiping out their life savings.