Genesis Files Suits Against DCG to Recover Billions Worth of Allegedly Fraudulent Transfers

Crypto lender Genesis and its subsidiaries filed two lawsuits in opposition to its father or mother firm, Digital Currency Group (DCG), DCG CEO Barry Silbert and different executives, looking for to recuperate what it known as fraudulent transfers of crypto price billions of {dollars}.

In whole, Genesis and its collectors are looking for $3.2 billion throughout the 2 lawsuits. It is looking for to recuperate $2.2 billion in a swimsuit filed within the Court of Chancery of the State of Delaware and greater than $1 billion in a swimsuit on the Bankruptcy Court for the Southern District of New York.

The New York submitting says cash was withdrawn from Genesis to repay DCG, Silbert, associates and different insiders within the 12 months that led up to Genesis submitting for Chapter 11 despite the fact that the corporate was bancrupt.

They “knew through their close relationship with Genesis that its business was on the brink of collapse” and took the chance to withdraw all their property and recuperate 100% of crypto and greenback loans made to the platform whereas members of the general public had been “kept in the dark,” the swimsuit alleges.

Genesis suspended withdrawals in November 2022 and went into chapter 11 the next 12 months.

“Silbert and his cronies recklessly operated, exploited, and then bankrupted Genesis following a spectacular campaign of fraud and self-dealing,” the Delaware submitting alleges.

Its collectors are nonetheless brief $2.2 billion price of crypto property together with bitcoin

, ether and different tokens, the submitting mentioned.

Alongside looking for an award of damages, Genesis needs an equitable belief over any property the “defendants improperly took or converted during their tenure as managers, officers, directors,” the submitting mentioned.

“These baseless lawsuits recycle the identical drained, two-year previous claims in an opportunistic try by refined buyers to extract extra worth from DCG,” a spokesperson for the company said. “We labored in good religion with a variety of stakeholders to attempt to obtain a complete decision of the DCG-related features of the Genesis chapter. We will vigorously defend ourselves in opposition to these spurious claims.”