Photo: Afghan National Police
The New York Attorney General has charged cryptocurrency companies Gemini, Genesis, and Digitalcurrency Group (DCG) with defrauding more than 230,000 investors. The fraud is said to have involved more than $1 billion.
Gemini and Genesis allegedly lied about the risks of the investments they offered. This is the latest large-scale action against cryptocurrency platforms in the US following the bankruptcy of Sam Bankman-Fried’s FTX cryptocurrency exchange. Earlier this month, Bankman-Fried’s fraud trial began.
The scandal surrounding Genesis and Gemini has also affected Dutch cryptocurrency investors. At the end of last year, it emerged that Bitvavo, the largest cryptocurrency exchange in the Netherlands, had loaned €280 million worth of digital currencies from customers to Genesis.
Former Genesis CEO Soichiro Moro and CEO Barry Silbert of DCG, Genesis’ parent company, are primarily responsible for the losses, according to New York Attorney General Letitia James. As a result of their misleading claims, some investors lost their entire savings. “New Yorkers and diligent investors across the country have lost more than a billion dollars because they were fed blatant lies that their money would be safe.” James demands the return of all ill-gotten gains.
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