Bankrupt crypto lending platform Celsius withdraws request to hire CFO at $92,000 a month – CNBC | Vette Leader

Celsius was sued by former investment manager Jason Stone on Thursday as pressure continues to mount on the company amid cryptocurrency price crashes. Among other things, Stone has claimed that Celsius CEO Alex Mashinsky (above) “has been able to significantly enrich himself.”

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Embattled lending platform Celsius has withdrawn its request to bring back ex-CFO Rod Bolger for $92,000 a month pro rata for at least six weeks, according to a court document filed in the Southern District of New York on Friday. The resignation statement came just ahead of a hearing scheduled for Monday to review it.

While Bolger worked full-time as CFO for the company, the original application shows he had a base salary of $750,000 and a performance-related cash bonus of up to 75% of his base salary, in addition to stock and token options. The peak of his total earnings is around $1.3 million. The filing also revealed that Bolger is technically still on the company’s payroll.

“On June 30, 2022, Mr. Bolger informed the debtors that he was voluntarily terminating his employment,” the file says. “In accordance with his notice of termination and the terms of his employment contract (as defined below), Mr. Bolger is required to give the debtors eight weeks’ notice of what he has done and he will continue to serve as an employee of the debtors.”

Had the application been approved, it’s unclear whether Bolger might have received compensation of $62,500 (his monthly base salary) in addition to the $92,000 monthly consulting fee Celsius had requested. The filing states that while he remains an employee of Celsius, Bolger is “not entitled to any severance pay.”

CNBC contacted Celsius to inquire about the terms of the proposed application, but did not immediately receive a response to our request for comment, which was sent outside of business hours.

The decision to deny the filing came three days after CNBC first reported on the filing to enlist Bolger’s help as an advisor during the bankruptcy proceedings. It also follows a formal objection by Keith Suckno, a CPA and Celsius investor, who challenged Celsius’ move, claiming that “little details” were given as to why Bolger’s services were necessary to the bankruptcy proceedings.

In the original filing, Celsius said it needed Bolger as an advisor to steer the bankruptcy process “due to Mr. Bolger’s familiarity with the debtors’ business.” It is said that during Bolger’s tenure, he led efforts to stabilize the business during the turbulent market volatility that year, oversaw the financial aspects of the business and served as head of the company.

Bolger, a former CFO of Royal Bank of Canada and divisions of Bank of America, was previously at Celsius for five months before resigning on June 30, about three weeks after the platform suspended all withdrawals.

Bolger’s final days at Celsius

In Suckno’s objection to putting Bolger back in charge of the bankruptcy case, he claimed that Bolger had “Celsius’ financial condition and liquidity” in a company blog post published five days ago entitled “Get to Know Rod Bolger, Chief Financial Officer, Celsius.” incorrectly stated”. before the platform froze withdrawals due to “extreme market conditions”.

In that post, which CNBC also reviewed, Bolger said in a print interview that Celsius’s “strong liquidity framework, established practices around liquidity data and modeling” are similar to those of other major financial institutions.

“This has put us in a strong position to weather the recent market turmoil and ensure that clients who need to access their digital assets can get them freely and clearly,” continued Bolger’s quote in the Celsius blog post. The following Monday, the platform halted all withdrawals and transfers.

Meanwhile, two days after that blog post — and three days before Celsius froze customer funds on the platform — Bolger was featured on Celsius’s weekly ask-me-anything show on YouTube, where he said the company welcomes the regulation.

“We believe in transparency. Blockchain is about transparency. We are transparent. You know, my goal is for us to be regulated everywhere,” Bolger said in the video.

“We have voluntarily disclosed a lot of financial information. My goal – even before we’re regulated and/or public and committed to – is to continue building tools that are Basel-like… Those are the standards that basically the banks are working under,” Bolger continued, adding that Celsius is already evaluating market risk and operational risk so they “could continue to build trust in the community.”

The video was released on Friday, June 10, and the following Monday, June 13, Celsius closed its entry and exit ramps for user funds. Celsius owes its users around $4.7 billion, according to the bankruptcy filing.

CNBC sent multiple requests to Bolger on two different platforms, but didn’t immediately get a response.

Following Bolger’s departure from the position of CFO, Celsius then installed Chris Ferraro, then head of financial planning, analysis and investor relations for Celsius. Within days of his appointment, the company filed for bankruptcy protection.

Once a titan of the crypto lending world, Celsius now faces claims that it ran a Ponzi scheme by paying early depositors with the money it received from new users.

At its peak in October 2021, CEO Alex Mashinsky said the crypto lender had $25 billion in assets under management. Now Celsius is down to $167 million “in treasury,” which it says will provide “ample liquidity” to support operations through the restructuring process.

This filing also reveals that Celsius has more than 100,000 creditors, some of whom have lent the platform cash with no collateral to back the agreement. The list of the top 50 unsecured creditors includes Sam Bankman-Fried’s trading company Alameda Research.

Individual investors have petitioned the judge to help them recover some of their lost holdings, with some saying their life savings have been virtually wiped out.

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