New York State Attorney General Letitia James has accused Digital Currency Group (DCG) and its affiliates of running a cryptocurrency fraud scheme estimated to exceed $3 billion.
The expansion triples the original charges in October, implicating DCG, its Genesis Global Capital unit, and Gemini Trust, run by husband-and-wife team Cameron and Tyler Winklevoss.
$3 billion cryptocurrency scam
The lawsuit centers on the Gemini Earn program, which promises high profits by lending crypto assets to investors. Mr. James alleges that DCG and Genesis defrauded investors, resulting in losses of more than $1 billion. The deception reportedly extended to direct investors in Genesis, who were falsely reassured that their funds were safe.
The lawsuit seeks to secure more than $3 billion in compensation for the more than 230,000 affected investors.
“This illegal cryptocurrency scheme and the horrific economic losses suffered by real people are yet another reminder of why we need stronger cryptocurrency regulation to protect all investors,” James said. Stated.
The case further complicates legal issues for DCG and its subsidiaries. Genesis filed for bankruptcy in January 2023 after Gemini Earn customers suspended withdrawals in the aftermath of FTX's collapse. Both companies are facing lawsuits from the U.S. Securities and Exchange Commission (SEC) for circumventing disclosure requirements and putting customers' investments at risk.
This is a developing story…
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