Celsius removes CFO off site after arrest in connection with Hogeg’s crypto Ponzi scheme

Celsius Network’s chief finance officer was detained in Tel Aviv last week on suspicion of having links to troubled cryptocurrency entrepreneur Moshe Hogeg.

Yaron Shalem, the chief financial officer of Celsius (CEL), was detained by Israeli police in connection with an operation involving crypto billionaire Moshe Hogeg and at least seven of his accomplices.

The Celsius Network has removed all references to Shalem from its website. Shalem was identified as the project’s CFO on archive.org and other online archiving sites as recently as November 24.

Hogeg faces fraud, money laundering, and sexual assault accusations. Detailed information on the charges brought against Hogeg colleagues, including Shalem, is not yet accessible.

Israeli news organisation Haaretz highlights Hogeg’s diverse holdings, which include the Israeli soccer club FC Jerusalem.

Alex Mashinsky, CEO of Celsius Network, had refused to disclose knowledge of Shalem’s detention. When Celsius recognised the incident, it said that one of its staff members was under “police investigation” and that the company’s money were secure.

Israeli police were investigating a total of 18 persons in connection with an alleged fraud and money laundering conspiracy, according to a police report.

Celsius’s chief financial officer is intimately acquainted with crypto billionaire Hogeg. Mashinsky denies that Hogeg is connected to Celsius Network in any way. Shalem did, however, work for Hogeg for years, most recently as CFO of Hogeg’s venture capital firm, SingulariTeam.

Mashinsky has advised companies such as Hogeg’s Sirin Labs (SRN), which in 2019 repurposed Hogeg’s failing $16,000 premium smartphone into a “blockchain phone” with its own cold wallet.

Hogeg also advised Mashinsky’s Celsius Network, according to archives. Celsius Network provides cryptocurrency loans and guarantees an annualised return of up to 17% on deposited crypto assets. It just raised $750 million in a new round of investment.

During a Bloomberg inquiry, Mashinsky acknowledged to exchanging over $1 billion in commercial paper loans using Tether (USDT).

Celsius acquired an extra $1 billion in new USDT shortly after that revelation. Mashinsky also has a trading account with Bitfinex.

Tether has garnered the attention of the New York Attorney General, the Commodity Futures Trading Commission, the Securities and Exchange Commission, the Federal Reserve, and even US Treasury Secretary Janet Yellen, who has expressed personal concern about Tether’s lack of transparency regarding its backing. Yellen also opposes stablecoins’ ability to undermine fiat currencies such as the US dollar’s supremacy.

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