An Imperial CFO was arrested on charges relating to his prior employment at Moshe Hogeg’s firm.

Yaron Shalem, the CFO of cryptocurrency lending firm Celsius, was one of the seven individuals detained in Tel Aviv on August 14 as part of Israeli crypto magnate Moshe Hogeg’s investigation. Hogeg is under investigation for a range of reasons, including a questionable business connection with superstar Amit Bitton, who plays in the Israeli basketball league.

Shalem has been accused of stealing $18 million from Hogeg’s $50 million funds using cryptocurrency to transfer funds globally and launder them before ultimately withdrawing the money in cash.

Shalem used bitcoin to purchase cryptocurrency on foreign exchanges, which was then sold in Israel. This allowed him to transfer funds between countries without exposing the source of the money. By performing transactions by cryptocurrency, it would appear as though money is being transferred locally within the country when it actually has moved between accounts located abroad.

Hogegs Background 

As Hogeg was previously the manager of basketball player Bitton, he would sometimes pay Shalem in cash. This deposited cash then went through another series of transactions that led to Shalem’s personal account at Bank Hapoalim.

Shalem has denied any wrongdoing while under investigation, while Hogeg’s lawyers have stated that “the details of this case are far-fetched and not rooted in reality.”

Shalem has worked with Celsius since July of last year. He was previously employed by Hogeg at Mobli but left the company when it ran into severe financial difficulties in 2015.

Celsius is a cryptocurrency lending firm that was co-founded in 2017 by Alex Mashinsky. The platform enables users to borrow money by using their cryptocurrency as collateral, offering individuals opportunities to earn returns on their holdings. Back in April of this year, Mashinsky stated that the firm had generated $30 million in revenue across its two lending products during its first six months since launching.

The company recently announced plans to launch a new business later on in the year focused on trading cryptocurrency from a headquarters based outside of Israel.

Celsius has already been subject to legal action in Israel over its lending products, which have seemingly been deemed by some as a Ponzi scheme that misleads investors into thinking they can earn returns greater than their initial investment. The company is also being sued over allegations of the company being a money-laundering enterprise. An additional lawsuit has been brought against the company by Bank Hapoalim for damaging its reputation. The bank is demanding $2 million in damages.