Voyager Digital Agrees to $1.65 Billion Settlement with FTC in Landmark Case

blockchain.news:

A decision that is of great significance has been handed down by the United States District Court for the Southern District of New York. A judge named Gregory Woods gave his approval to an order that required Voyager Digital and its affiliates to make a payment of $1.65 billion to the Federal Trade Commission (FTC) of the United States of America. This ruling, which was submitted on November 28, 2023, comes after a settlement was negotiated between Voyager and the Federal Trade Commission in October. This settlement marks a significant turning point in the regulatory control of bitcoin lending companies.

Legal action was taken by the Federal Trade Commission against Voyager Digital and its former CEO, Stephen Ehrlich, for making false statements about the security of consumer cash. In particular, they made a misleading assertion that client accounts were protected by the Federal Deposit Insurance Corporation (FDIC), which was a deception that took place at a time when Voyager was flirting with the possibility of filing for bankruptcy. Due to the false ads, consumers were given the impression that their deposits in United States dollars would be safe. This resulted in large losses for Voyager when the company filed for bankruptcy in July of 2022."

Voyager will be liable to a punishment of $1.65 billion and will be prohibited from promoting or delivering goods or services linked to digital assets as a result of the conditions of the settlement. In order to provide Voyager with the opportunity to compensate its clients, this punishment will be deferred. The Federal Trade Commission (FTC) is conducting ongoing investigations, and Voyager and connected parties are obligated to assist with the FTC in these investigations.