Cuba questioned over promotion of bankrupt crypto lender

Cuba questioned over promotion of bankrupt crypto lender

Cuban was fired as a part of a category motion lawsuit accusing him of selling a “Ponzi scheme” at Voyager Digital.

DALLAS — Dallas Mavericks proprietor Mark Cuban might be questioned subsequent month as a part of a category motion lawsuit filed towards now-bankrupt cryptocurrency lender Voyager Digital, alleging the corporate is an “unregulated and unsustainable rip-off.”

The criticism alleges that Cuban and Voyager CEO and Co-Founder Stephen Ehrlich personally reached out to traders to encourage them to spend money on the corporate, each individually and thru Mavericks.

“As might be disclosed, Cuban and Ehrlich have gone to nice lengths to entice tens of millions of Individuals into investing within the Misleading Voyager Platform—in lots of instances their life financial savings—and to make use of their expertise as traders to buy Voyager Advantages Program Accounts (“EPAs”). are unregistered securities” reads the criticism.

The lawsuit claims that greater than 3.5 million individuals misplaced greater than $5 billion in crypto belongings on account of the platform, which goals to carry Ehrlich, Cuban, and the Dallas Mavericks chargeable for reimbursement.

Voyager was a multi-billion greenback cell app that positioned cryptocurrency buying and selling orders. The lawsuit states that it’s going to goal younger, inexperienced traders who’re new to cryptocurrency buying and selling, promising curiosity funds on cryptocurrency holdings and getting the very best worth in cryptocurrency buying and selling.

Nonetheless, the lawsuit alleges that Voyagers’ statements and statements are false, deceptive, and violate numerous state and federal shopper legal guidelines.

The criticism states, “The Misleading Voyager Platform relies on false claims, misrepresentations and is particularly designed to make the most of traders utilizing cell apps to make their investments in an unfair, disagreeable and misleading method.” “Merely put, Plaintiffs will show that the Misleading Voyager Platform is a home of playing cards constructed on false guarantees and inconceivable representations primarily based on information, particularly designed to use the cryptocurrency craze to the direct detriment of any extraordinary investor.”

The lawsuit continues with the allegation that the Voyager defendants by no means disclosed that they intentionally set the costs on their platform excessive sufficient to gather exorbitant hidden commissions on each cryptocurrency commerce, regardless of claiming to be “100% commission-free.”

The criticism states that Cuban strongly helps and touts his partnership with Voyager at a current Dallas Mavericks press convention, the place he defined how Voyager will assist enhance its attain and presence.

“Merely put, there’s untapped potential in the way forward for digital currencies and is a sexy funding for novice traders who could solely have $100 to get began,” Cuban stated, in keeping with courtroom paperwork. “That is the place Voyager is available in.”

Whereas Cuban disclosed the partnership between Voyager and the Dallas Mavericks, the lawsuit claims he by no means disclosed the extent of the connection and the way a lot Voyager was personally paid for its promotion; be in violation of the anti-touting provisions of the federal securities legal guidelines.

Within the criticism, Cuban beforehand referred to as Voyager “near being risk-free as you’d enter the crypto universe,” and as soon as held a press convention with Ehrlich and New York Knick Jalen Brunson, who was a Maverick on the time, stated, “That is my first time moving into the crypto enterprise, What are some necessary issues I ought to know?

“[T]The Misleading Voyager Platform was an enormous pyramid scheme and relied on Cuban’s and Dallas Maverick’s audio assist and Cuban’s monetary funding to maintain itself till its personal explosion after which Voyager’s chapter.”

Cuban requested that his testimony be cut up into two periods, however a decide denied his request and his full assertion might be taken on February 2.

WFAA reached out to Cuban for remark and acquired no response.

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