Embattled cryptocurrency lending platform Celsius last month withdrew its offer to the Southern District Court of New York to bring back former chief financial Officer Rod Bolger as an adviser on bankruptcy proceedings at a salary of $92,000 a month, just days before a hearing.
Celsius has not stated the reason for the withdrawal, but Keith Suckno, CPA and Celsius investor, has previously objected to and challenged the proposal.
He claimed that Celsius was not sufficiently detailed in its description of the necessity of employing Rod Bolger for the company’s bankruptcy proceedings.
RodBolger stepped down as Treasurer on June 30 of this year, approximately three weeks after Celsius froze withdrawals, after 5 months in office. Celsius subsequently filed for bankruptcy protection in mid-July, followed by a petition to retain RodBolger at a high salary on July 25.
Celsius stated at the time that Rod Bolger would be sought because he would be familiar with the debtor’s business and would provide accounting and finance expertise that Celsius would require.
Celsius wrote in the document: In consideration of the consulting services provided by Mr. Bolger, the debtor agrees to pay Mr. Bolger C $120,000 (approximately US $92,848) per month in prorated installments.
As per Celsius’s original proposal, Rod Bolger would receive a base annual salary of $750,000 with a performance bonus of up to 75%, representing a maximum gross income of $1.3 million.
However, as of July 31, 2022, the average CFO in the U.S. earns $12,134 a month, with a maximum salary of $21,500, according to employment website ZipRecruiter.
It follows that Rod Bolger’s salary is unreasonably high.
Celsius was widely criticized earlier this year when Stakehound, a Stakehound company, lost their private key and produced as many as 35,000 Ether coins. However, when Celsius failed to achieve this high standard, its reputation was severely undermined.
Celsius was then forced to admit, after filing for bankruptcy, that it had a balance sheet hole of nearly $1.2bn, blaming poor investments and other unexpected losses for the shortfall.
Celsius users would have expected to get their assets back, but Celsius’s bankruptcy lawyers would later argue at a bankruptcy hearing that they had effectively given up ownership of their cryptocurrency when they deposited it on their Celsius platform.
Celsius’s terms of service also stated that in the event of a bankruptcy or liquidation, any funds deposited on the platform could not be recovered, leaving hundreds of angry and anxious recipients to write to a judge for help.