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NEW YORK - Roni Cohen-Pavon, a former executive at Alex Mashinsky's now-bankrupt cryptocurrency lender Celsius Network, has pleaded guilty to U.S. criminal charges and agreed to cooperate with prosecutors' investigations.
Cohen-Pavon, Celsius' former chief revenue officer, admitted to four charges, including manipulating the price of the exchange's crypto token Cel, at a Wednesday hearing before U.S. District Judge John Koeltl in Manhattan, court records showed on Thursday.
He agreed to assist the U.S. Attorney's office in Manhattan and the FBI with their investigations and to testify in court if called to do so, according to a copy of his plea agreement seen by Reuters.
The defendant and Mashinsky had each been charged in July with market manipulation and wire fraud for artificially inflating Cel's value and cashing out their personal holdings prior to Celsius' July 2022 collapse.
Prosecutors said Mashinsky reaped about $42 million from his sales. He pleaded not guilty and was released on a $40 million bond.
Cohen-Pavon, an Israeli citizen, had been abroad when the charges were announced, according to Damian Williams, the top federal prosecutor in Manhattan. He is free on a $500,000 bond and may travel between New York and Israel.
Neither lawyers for Cohen-Pavon nor a spokesman for the U.S. Attorney's office in Manhattan immediately responded to requests for comment. Mashinsky's lawyers did not immediately respond to similar requests.
Crypto lenders such as Celsius grew rapidly as crypto prices surged during the COVID-19 pandemic They promised easy loan access and eye-popping interest rates to depositors, then lent out tokens to institutional investors, hoping to profit from the difference.
Celsius imploded amid a flurry of customer withdrawals as cryptocurrency prices fell.
It was among the earliest of several cryptocurrency bankruptcies, including the FTX exchange, as prices cratered while interest rates rate.
Williams' office has also charged several other crypto executives with fraud, including FTX founder Sam Bankman-Fried, who has pleaded not guilty and faces an Oct. 3 trial.
According to Cohen-Pavon's plea agreement, prosecutors may recommend Koeltl take his assistance into account during his sentencing, which is scheduled for Dec. 11, 2024.
(Reporting by Luc Cohen in New York; Editing by Chizu Nomiyama and David Holmes)