New York Attorney General Expands Lawsuit Against Digital Currency Group
New York Attorney General Letitia James has tripled the estimated size of the alleged fraud in the state’s lawsuit against Digital Currency Group (DCG), now claiming it exceeds $3 billion. The amended complaint, filed by Attorney General James, accuses DCG, its CEO Barry Silbert, and bankrupt crypto lender Genesis Global Capital of defrauding additional individuals and institutions of an additional $2 billion.
Lawsuit Stemming from Misleading Representations
The lawsuit originated from a suit filed in October 2023, where Gemini, Genesis, and Digital Currency Group were accused of misleading investors about the Gemini Earn investment program, resulting in over $1 billion in losses.
Further Investigations Reveal More Victims
Following continued investigations, the New York Attorney General’s office discovered that more investors had been defrauded. This led to the expanded lawsuit, with over 230,000 estimated victims in total. These additional investors were given false assurances about the safety of their funds, resulting in significant financial losses.
Call for Stronger Cryptocurrency Regulations
Attorney General James emphasized the need for stronger cryptocurrency regulations to protect all investors, stating: “This illegal cryptocurrency scheme, and the horrific financial losses that real people have suffered, are yet another reminder of why stronger cryptocurrency regulations are needed to protect all investors.”
NYAG’s Crackdown on Crypto Scams
Attorney General James has taken various actions in recent years to combat fraud in the cryptocurrency industry. These include recovering funds from non-compliant platforms like CoinEx and Coin Cafe, securing court judgments against Coinseed and GTV Media for alleged fraudulent practices, and recovering millions from Nexo’s cryptocurrency platform.
Implications for the Crypto Industry
The outcome of the case against Digital Currency Group and Genesis will have implications for both the parties involved and the broader cryptocurrency industry. It remains to be seen how the accused companies will respond to the allegations and the increased scope of the fraud claims made by the Attorney General.
As of now, the cryptocurrency market has experienced a surge in market capitalization, reflecting a resurgence of bullish sentiment within the industry.
By
By
By