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Fortress Trust Faces Cease-and-Desist Amid Insolvency Fears

Fortress Trust Faces Cease-and-Desist Amid Insolvency Fears

Author:

Global Cryptocurrency

Published:

2025-10-24 09:34:02

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BTCCSquare news:

Nevada regulators have ordered Fortress Trust, rebranded as Elemental Financial Technologies, to halt operations due to severe liquidity shortfalls. The Financial Institutions Division (FID) issued a cease-and-desist on October 22, citing "unsafe and unsound" practices that jeopardize client assets.

The custodian faces insolvency allegations, with regulators revealing an inability to meet customer withdrawals or match liabilities. Over 250,000 users, including crypto firms and digital asset retirement accounts, are at risk. Fortress failed to provide critical financial reports, exacerbating concerns.

The order prohibits deposit-taking, withdrawals, and custody services. Civil penalties up to $10,000 per violation may apply as fraud investigations proceed. Founded in 2021 by Scott Purcell, Fortress's collapse underscores mounting regulatory scrutiny in digital asset custody.

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