Under the directives for determining the applicable sentence, Mashinsky could have incurred up to 30 years in prison. But federal judges are required to take into account various additional factors when they arrive at a sentence, including the personal characteristics and history of a defendant, the probability that they could recur, etc.
“It is a complicated fact of facts to bring together to achieve a fair sentence,” said Timothy Howard, partner of the law firm Freshfields and the former prosecutor of the Southern New York district.
Before the hearing of determination of the sentence, the legal representatives of Mashinsky had asked for the judge for a custody of only 366 days, citing his admissions of guilt, the military service in Israel, the deprivation he knew in childhood and the factors of the external market which contributed to the fall of Celsius.
“This affair does not concern a arrogant and gourmet crook who thought he could get away by stealing money harvested people to satisfy his own hedonistic pleasures,” said the lawyers of Mashinsky in a legal file. “These are post-hocshallow and dehumanizing tropes that do not apply here. »»
The MJ, on the other hand, asked the judge to impose a 20 -year prison sentence. Despite the guilty plea and its conceded to certain lies, Mashinsky had not shown any contrition for his misdeeds, prosecutors said. He had also not defrauded his customers involuntarily, they argued.
“His crimes were not the product of negligence, naivety or bad luck. They were the result of deliberate and calculated decisions to lie, to deceive and to fly in pursuit of personal fortune,” wrote the prosecutors in their file. “He abandoned any pretension to recognize his supportive reprehensible acts … This deep lack of remorse underlines the continuous danger he poses.”
The gap of yawning between the penalties requested by the defense and the accusation reflects the dispute between the two parties on the nature of the reprehensible acts of Mashinsky: namely if the founder Celsius was guilty of a handful of lies not considered as fraud.
“When there has been a plea, insofar as there are factual disputes, they are often relatively minor and the core of driving is clear,” explains Katherine Reilly, partner of the law firm Pryor Cashman who had previously directed complex frauds and cybercrime in the SDNY. “But here, the defense has really tried to implement that the offense is narrower than the government does not claim.”
By asking for a prison sentence only one year old and conceding to very limited reprehensible acts, Mashinsky and his advice “walked on a tightrope”, explains Howard. “It is a strategic decision that the defense lawyer must make. You must balance the advocacy for your client with the lowest possible trouble, while maintaining a certain credibility with the judge, ”he says.
In its submissions, the government made direct comparisons between Mashinsky and various other condemned fraudsters, including Sam Bankman Fried, who was sentenced last year to 25 years in prison for his role in the elaborate fraud that led to the collapse of his Crypto exchange, FTX. In their file, the lawyers of Mashinsky tried to create a distance as large as possible between their client and Freed Bankman. “Although there may be superficial similarities, these two cases of cryptography and their respective accused are nothing similar,” they said. The crucial difference, has argued the defense, is that Mashinsky has not been accused of embezzlement of funds or theft of customer funds.
“This difference obtains the factual disputes presented in the submissions,” explains Reilly. “Was it some errors of judgment in order to try to straighten the ship?” Or was it really a fraudulent platform full of self-designing? ”
In the end, the judge proved to be unfriendly to the version of Mashinsky’s events, judging that the gravity of his crimes and the extent of the damage he caused to the victims justified a substantial prison sentence.
Having received his sentence, Mashinsky will be temporarily released while the Bureau of Prisons selects an appropriate establishment. As a rule, defendants in white collar like Mashinsky are accommodated with other non -violent delinquents, according to legal experts.
In the federal system, there is no possibility of parole. Once the clock begins to check the prison time of Mashinsky, the best he can hope is an early release for reasons of good conduct, but generally that after 85% of his sentence was purged.
By targeting a very small sentence, Mashinsky was in disorder with a “risky strategy”, explains Howard, creating an opportunity for prosecutors to demonstrate that he had largely minimized his conduct. “It really pulls a hole in the ship.”
