Celsius was sued on Thursday by former investment director Jason Stone, with pressure on the company continuing amid the collapse in cryptocurrency prices. Stone claimed, among other things, that Celsius CEO Alex Mashinsky (above) was “able to enrich himself significantly.”
Piaras Ó Mídheach | Sportsfile for the web summit | Getty Images
The beleaguered lending platform Celsius . withdrew Her move to bring back the former CFO Rod Bolger $92,000 per month, split over a minimum six-week period, According to a court document Presented in the Southern District of New York on Friday. The notice of withdrawal came ahead of a hearing scheduled for Monday to review it.
While Bolger worked full time with the company as a financial manager, Original Motion Shows That he has a base salary of $750,000 and a performance-based cash bonus of 75% of his base, plus stock and token options, bringing the top of his total income to about $1.3 million. The filing also noted that Bolger is technically still on the company’s payroll.
“On June 30, 2022, Mr. Bulger notified the debtors that he would voluntarily terminate his employment,” reads deposit. “Pursuant to his notice of termination and the terms of his employment agreement (as defined below), Mr. Bulger is required to give the debtors eight weeks’ notice, which he has done, and he continues to act as an employee of debtors.”
Had the proposal been approved, it is not clear whether Bulger would have received the $62,500 compensation (his monthly base salary), in addition to the $92,000 monthly counseling fee he requested. The request stated that he was continuing to work as an employee of Celsius, but also noted that Bolger “is not entitled to any severance payments.”
CNBC reached out to Celsius to inquire about the terms of the proposed proposal, but it did not immediately hear our request for comment, which was sent out of business hours.
The decision to deny the application came three days after CNBC first reported a request for Bolger’s assistance as a counselor during the bankruptcy process. It also follows a Formal objection submitted by Keith Soknow, the CPA and Celsius investor who challenged Celsius’ move, claiming that “few details” were given as to why Bolger’s services were important to bankruptcy proceedings.
In the original motionCelsius said she needed Bulger to help her navigate bankruptcy proceedings as an advisor, “because of Mr. Bulger’s knowledge of the debtors’ business.” He went on to say that during Bolger’s tenure, he led efforts to stabilize the business during the turbulent market volatility this year, directing the financial aspects of the business and serving as the company’s leader.
Bolger, A Former Chief Financial Officer of Royal Bank of Canada and Bank of America divisionsHe was previously with Celsius for five months before resigning on June 30, about three weeks after the platform paused all withdrawals.
In Suckno’s objection to Bulger’s reinstatement of bankruptcy proceedings, he claimed that Bulger had “misidentified the financial position and liquidity” of Celsius in a company blog post titled “Meet Rod Bolger, Chief Financial Officer, Celsius,” Posted five days before the platform suspended withdrawals due to “extreme market conditions.”
In that post, also reviewed by CNBC, Bolger said in a print interview that Celsius’ “strong liquidity framework, well-established practices around liquidity data, and modeling” were similar to other large financial institutions.
“This has put us in a strong position to weather the recent market turmoil and ensure that customers who need access to their digital assets can get it free and clear,” Follow Bolger’s quote in Celsius’ 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 clients’ funds on the platform – Bulger appeared on Celsius’ weekly Ask-me-anything on YouTubein which he said the company welcomed the regulation.
“We believe in transparency. Blockchain is about transparency. We are transparent. You know, my goal is to be regulated everywhere,” Bolger said in the video.
“We have voluntarily disclosed a lot of financial information. And my goal – even before we were regulated and/or public and required to do so – is to continue to build the tools that like Basel… These are the standards by which banks operate,” Bolger continued, adding that the percentile was already assessing market and operational risks, so they could “continue to build the level of trust in the community.”
The video was posted on Friday, June 10, and on the following Monday, June 13, Celsius closed its choppy slopes to users’ money. Celsius owes its users about $4.7 billion, According to its bankruptcy filing.
CNBC sent Bolger multiple requests on two different platforms but did not immediately receive a response for comment.
Following Bulger’s departure as Chief Financial Officer, Celsius subsequently installed Chris Ferraro, then Head of Financial Planning, Analysis and Investor Relations at Celius Corporation. Within days of his appointment, the company filed for bankruptcy protection.
Once a giant in the crypto lending world, Celsius is now facing allegations that it operated a Ponzi scheme by paying early depositors with money they got from new users.
At its peak in October 2021, CEO Alex Mashinsky said that Cryptocurrency lender has $25 billion in assets under management. Now, degrees Celsius has dropped to $167 million “cash on hand”, Which it says will provide “ample cash” to support operations during the restructuring process.
This filing also shows that Celsius has more than 100,000 creditors, some of whom lent the platform in cash without any collateral to support the arrangement. The top 50 unsecured creditors include Alameda Research’s Sam Bankman-Fried business.
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