Gemini has agreed to a $50 million settlement for a crypto fraud claim in New York. As part of the settlement, Gemini is also prohibited from operating lending programs in the state.

New York Attorney General Letitia James announced that her office has successfully secured $50 million from the crypto platform Gemini. This amount will be used to reimburse investors affected by the Gemini Earn program.

The lawsuit alleges that Gemini deceived investors out of over $3 billion. Internal Gemini documents were cited to show that the exchange was aware of the high risks associated with the program.

“Hundreds of thousands of people, including at least 29,000 New Yorkers, had their trust broken and their money swindled by Gemini through its bogus Earn program,” stated Attorney General James. “Gemini marketed its Earn program as a way for investors to grow their money, but actually lied and locked investors out of their accounts. Today’s settlement will make defrauded investors whole and should remind cryptocurrency companies that deceiving investors is illegal and will not be tolerated by my office.”

Gemini will refund $50 million in digital assets to Gemini Earn investors who were unable to access their accounts. More than 230,000 Earn investors will benefit from these recoveries. Investors do not need to take any action to reclaim their digital assets.

Background on Gemini Earn

Gemini Earn offered attractive interest rates to investors who lent cryptocurrency to Genesis Global Capital, a unit of Digital Currency Group. Gemini charged agent fees exceeding 4% for this service.

In November 2022, Genesis suspended redemptions following the collapse of the cryptocurrency exchange FTX. Subsequently, Genesis filed for Chapter 11 bankruptcy, leaving investors scrambling for their investments.

Gemini is operated by billionaire twin brothers Cameron and Tyler Winklevoss.

Stay updated on the latest cryptocurrency news and developments at Global Crypto News.

Post Views: 5