A Ledger spokesperson refuted that, saying, “Customers can create an encrypted backup of their private keys which is then sharded and encrypted further […] The private key can only be decrypted and reconstituted on a Ledger’s secure element chip, just as it is initially encrypted and fragmented there. Ledger cannot and does not access users’ private keys.” 

 Yes and the CEO said if they receive a government subpoena they can decrypt the shards and hand over your coins.

Also, their software is closed source so there is no way to verify it is doing what they say it is doing. 

Ledger is not cold storage. 

 Glad they don't have such a device at Ledger HQ. /s