New York Attorney General Letitia James is suing three cryptocurrency companies, Gemini, Genesis and Digital Currency Group (DCG), over claims they misled investors, resulting in a loss of more than $1 billion. In a lawsuit filed ThursdayJames says his alleged fraudulent schemes affected more than 230,000 investors.
The lawsuit targets Gemini, the crypto exchange owned by Cameron and Tyler Winklevoss, and its Earn program. The company marketed Gemini Earn as a high-yield program that involved clients investing in DCG-owned Genesis Global Capital. However, James alleges that Gemini knew that investing with Genesis was risky and misled customers as a result.
Additionally, James is suing Genesis and its parent company DCG for allegedly attempting to cover more than $1 billion in losses. James seeks to ban Gemini, Genesis and DCG from the investment industry in New York. He also wants the companies to “pay damages, restitution, and return all funds and cryptocurrency” they obtained as part of their alleged schemes.
“These cryptocurrency companies lied to investors and tried to hide over a billion dollars in losses, and it was middle class investors who suffered the consequences,” James says in a statement. “Hardworking New Yorkers and investors across the country lost over a billion dollars because they were told blatant lies that their money would be safe and grow if they invested it in Gemini Earn.”