Gemini Trust claims that the lawyers from the U.S. Commodity Futures Trading Commission (CFTC) filed "suspicious" charges against the cryptocurrency exchange in 2022 out of "selfish desires" to advance their careers.

In a letter to CFTC Inspector General Christopher Skinner on Friday, Gemini accused the agency's Division of Enforcement (DOE) lawyers of relying on an unreliable whistleblower report to bring the lawsuit against the company.

Gemini's lawyers stated, "DOE staff selectively and unfairly utilized the Commodity Exchange Act […] to bring dubious false statement charges against Gemini."

Gemini asserted that DOE staff were "driven by selfish desires to achieve a high-profile 'victory' over Gemini Trust through abuse of power to enhance their own careers," and claimed that "the charges against it stemmed from a whistleblower report filled with lies submitted by a disgraced former employee."

The CFTC sued Gemini in June 2022, accusing it of making false or misleading statements when the agency assessed whether the Bitcoin futures contracts it planned to launch were susceptible to manipulation in 2017.

Gemini paid a $5 million fine in January to settle the CFTC's charges, neither admitting nor denying the agency's findings. The exchange stated in its letter on Friday that it had "no choice" at the time.

Gemini claimed that the DOE's investigation and lawsuit relied on a false whistleblower report submitted in 2017 by the exchange's former operations chief, Benjamin Small. Benjamin allegedly launched a "malicious action" against the exchange after being fired.

Benjamin was dismissed for allegedly attempting to conceal losses resulting from a "multi-million dollar rebate fraud" in mid-2017. The exchange stated that this involved Hashtech LLC and its executives Alex Ruthizer and Jonathan David, as well as Cardano Singapore PTE Ltd. and its executive Satoshi Kobayashi.

Gemini accused these companies of "coordinating their trades to abuse a special fee structure and improperly obtain substantial rebates," and stated that Benjamin, as the then-operations chief, approved these actions before being fired by Gemini co-founders Cameron Winklevoss and Tyler Winklevoss.

Gemini claimed that after being fired, Benjamin reported to the CFTC that Gemini had not disclosed information regarding whether its Bitcoin futures contracts were susceptible to manipulation in its statements submitted to the agency.

The exchange stated that the CFTC's lawsuit lawyers then "immediately and unquestioningly" accepted Benjamin's claims and used them as the basis to investigate Gemini in 2018.

Gemini asserted that its Bitcoin futures contracts "operated smoothly for 19 months," during which "there were no allegations of contract manipulation."

Gemini noted that CFTC Acting Chair Caroline Pham outlined what she called "suspicious enforcement actions" in a statement in May 2024 and is "taking proactive steps to fix" the enforcement division.

Gemini stated, "This shift requires profound reflection and a long-term commitment from the agency as a whole to ensure that such dishonest behavior does not occur again."

The exchange expressed its willingness to assist the CFTC "in any way they deem helpful."

Related: Pump.fun and its founder's account were affected by a large-scale ban on the X platform.

Original article: “Gemini accuses CFTC enforcers of 'lawfare' in 2022”

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