7 months ago
Digital Currency Group (DCG) and its CEO Barry Silbert person filed motions to dismiss the $3 cardinal fraud suit filed by the New York Attorney General’s Office (NYAG), arguing that the allegations levied against them are “baseless innuendo.”
The NYAG filed the suit successful October 2023 implicit allegations that DCG and its subsidiary Genesis Capital misled customers astir the risks progressive with the Gemini Earn program, causing losses for customers to the tune of $3 billion.
DCG denies allegations
DCG has categorically denied the NYAG’s allegations, framing them arsenic baseless and lacking important evidence. The institution argued that its enactment for Genesis Capital was conducted successful “good faith,” backed by dependable proposal from reputable consultants and concern advisors.
According to the filing:
“The allegations are a bladed web of baseless innuendo, blatant mischaracterizations, and unsupported conclusory statements.”
In its defense, DCG contends that the allegations are a misguided effort by the NYAG to find a scapegoat for the losses suffered by customers owed to factors beyond the firm’s control.
The institution asserted that it went supra and beyond its obligations by injecting hundreds of millions of dollars into Genesis Capital successful the lead-up to its bankruptcy filing.
The ineligible documents further item the quality of the communications made by DCG and Genesis Capital, including retweets and statements deemed excessively vague to represent fraud. The steadfast besides challenged the applicability of New York’s Martin Act to its activities, arguing that the ineligible model does not enactment the NYAG’s case.
‘Kitchen-sink approach’
At the bosom of the defence is the assertion that Silbert was afloat committed to supporting Genesis done the crypto market’s challenges successful 2022, acting without immoderate fraudulent intent.
The defence criticized the NYAG for employing a “kitchen-sink” attack — accusing it of grouping Silbert unjustly with different defendants and basing its lawsuit connected improper radical pleading.
According to the filing:
“Mr. Silbert is respective steps removed from the alleged fraud, yet the Amended Complaint seeks to clasp him personally liable and permanently barroom him from the securities industry.”
Furthermore, it challenged the NYAG’s reliance connected selective quotations from Silbert’s communications — which, erstwhile viewed successful afloat context, purportedly show his ongoing assurance successful Genesis’ fiscal health.
Silbert’s actions, including the proviso of a $1.1 cardinal promissory enactment to Genesis, are highlighted arsenic grounds of his content successful the company’s viability and his liable oversight arsenic CEO.
The defence besides claims that helium and DCG had thing to bash with the connection Genesis made to investors, which is the superior statement backing the accusations that the companies misled investors. The defence added that DCG did not judge those statements were fraudulent.
Additionally, Silbert’s squad points retired procedural concerns, noting the NYAG proceeded with the suit without proceeding Silbert’s grounds — grounds that was delayed owed to his child’s wellness issues. This move, according to Silbert’s defense, underlines the NYAG’s haste and disregard for a broad investigation.
The station DCG, Silbert contradict NYAG allegations, determination to disregard $3 cardinal lawsuit appeared archetypal connected CryptoSlate.
English (US) 