NEW YORK (AP) — The founder and former CEO of the failed cryptocurrency lending platform Celsius Network was arrested Thursday on federal fraud charges alleging that he schemed to defraud customers by misleading them about key aspects of the business.

Alexander Mashinsky, 57, of Manhattan, was charged with securities, commodities and wire fraud in an indictment unsealed in Manhattan federal court. He was also charged with illegally manipulating the price of Celsius's proprietary crypto token while secretly selling his own tokens at inflated prices.

Jonathan Ohring, an attorney for Mashinsky, said in an email that his client "vehemently denies the allegations brought today."

"He looks forward to vigorously defending himself in court against these baseless charges," Ohring added.

According to the indictment, Mashinsky from 2018 to 2022 pitched Celsius to customers as a modern-day bank where they could safely deposit crypto assets and earn interest. But. it said, Mashinsky operated Celsius like a risky investment fund, taking in customer money under false and misleading pretenses and exposing customers to a high-risk business.

The indictment alleged that Mashinsky promoted Celsius through media interviews, his Twitter account and Celsius's website, along with a weekly "Ask Mashinsky Anything" session broadcast posted to Celsius's website and a YouTube channel.

Celsius employees from multiple departments who noticed false and misleading statements in the sessions warned Mashinsky, but they were ignored, the indictment said.

Mashinsky's false portrayal of Celsius as a safe and secure institution caused its customer base to grow exponentially through a large number of retail investors, the indictment said.

By the fall of 2021, Celsius had become one of the largest crypto platforms in the world, purportedly holding approximately $25 billion in assets, it said.

U.S. Attorney Damian Williams said the arrest of Mashinsky was further proof that his office will seek to hold responsible those who try to cheat ordinary investors.

"Whether it's old-school fraud or some new-school crypto scheme, it doesn't matter one bit. It's all fraud to us. And we'll be here to catch it," he said.

The Securities and Exchange Commission on Thursday also sued Mashinsky and Celsius, saying they misled investors through unregistered and often fraudulent offers and sales of crypto asset securities.

In January, New York Attorney General Letitia James sued Mashinsky in state court in Manhattan, saying he misled hundreds of thousands of investors.

Celsius filed for bankruptcy last year.