In an investigation conducted by the New York State Office of the Attorney General (OAG), the alleged fraud committed by Gemini, Genesis and Digital Currency Group (DCG) has been found to have tripled to more than $3 billion.
In October 2023, the OAG filed suit against these companies and their management for defrauding 230,000 investors of $1 billion.
According to the investigation, Gemini misled its users about its Earn staking program, which was developed in conjunction with Genesis.
Although Gemini had claimed that the product was low-risk, it was discovered that they transferred the funds raised through Earn to Genesis, which used them to make loans to Three Arrows Capital and Alameda Research, who ultimately turned out to be bankrupt.