Focus Board Member Resigns A Day After Her Husband’s Crypto Lender Failed
July 19, 2022
A Focus Financial Partners board member abruptly resigned from his post last week – after just 18 months of service – a day after her husband’s embattled cryptocurrency lender filed for bankruptcy while facing to an increasing number of disputes.
Krissy Mashinsky, who had joined the Focus board on January 1, 2021, resigned effective July 14 from the publicly traded acquirer of registered investment advisory firms, “to focus on other responsibilities “, according to a deposit with the Securities and Exchange Commission.
Her husband is Alex Mashinsky, CEO of Celsius Network Ltd., a crypto lender who filed for Chapter 11 bankruptcy last week, making him one of the latest victims of a cryptocurrency crash. $2 trillion that has plagued the digital asset space in recent months.
Celsius on June 12 had halted all withdrawals amid a panic from customers, and has since faced a series of lawsuits from former employees and clientsaccording the news and court records. It once promised customers returns of up to 19%, according to Reuters.
“Ms. Mashinsky’s resignation is not the result of a disagreement with the Company on any matter relating to the Company’s operations, policies or practices,” New York-based Focus wrote in its filing with the DRY.
A spokeswoman for Focus declined to comment beyond the case on the reasons for Mashinsky’s resignation. She also declined to comment on whether Mashinsky lost any Focus compensation or action as a result of his exit.
Mashinsky, as a director of the board, had earned $677,779 in total compensation in 2021, including $105,000 in cash, according to the proxy statement filed by Focus in April. Approximately $500,000 of option grants represented the bulk of the compensation, although the filing notes that the units granted would vest in three equal installments on each of the first three anniversaries of January 1, 2021,” provided that Ms. Mashinsky continues to provide services for us until each applicable acquisition date.”
Mashinsky, who had served on Focus’s audit and risk committee and as chair of its nominating, governance and sustainability committee, did not respond to a request for comment sent via social media.
Mashinsky had founded an e-commerce startup called usastrong.IO in April 2020 and is its CEO, according to her LinkedIn profile. She previously served as president of URBN Wholesale, a sister company to retailer Urban Outfitters.
Although she is not named as a defendant in two lawsuits filed against Celsius over its insolvency crisis, they each refer in their allegations to wallets controlled by Krissy Mashinsky.
A lawsuit, filed by KeyFi, a former Celsius asset manager, claims Celsius artificially inflated the price of its own digital coin, failed to hedge risk, and engaged in activities that constituted a fraud, according to a lawsuit filed July 7 in New York. Supreme Court.
The lawsuit also alleges that KeyFi operated a wallet that Alex Mashinsky – whom it does not name as a defendant – used “for his own benefit”. In one instance, according to the lawsuit, Alex Mashinsky allegedly transferred valuable non-fungible tokens, or NFTs, from the company’s account to a wallet controlled by his wife. (Celsius did not file a response in the case, and as of Tuesday no attorney was listed as representing the firm.)
Separately, in a class action lawsuit filed July 13 in the U.S. District Court in New Jersey, a Celsius client alleges that the company and executives, including Alex Mashinsky, owned the equivalent of $10 billion from the sale. unregistered securities as part of a “Ponzi-type” scheme. and that several wallets controlled by the Mashinskys “quietly” sold millions of dollars worth of CEL tokens. At the same time, according to the lawsuit, Alex Mashinsky was promoting CEL tokens while denying that he was selling them.
Citing a YouTube video from January this year, in which Alex Mashinsky answered users’ questions about market demand for his company’s CEL tokens, the suit alleges that Mashinsky, when asked if he or other Celsius insiders were selling the tokens, “loosely.” admitted that he and his wife “did a bunch of transfers”.
“We sold tokens. It’s not like we haven’t sold any,” Mashinsky reportedly said on the video. “My wife didn’t sell anything.”
Celsius did not file a response in the proposed class action lawsuit, and as of Tuesday no attorney was listed as representing Mashinsky or the firm. Alex Mashinsky did not immediately respond to a request for comment sent via social media.