- Former FTX chief Sam Bankman Fried, currently serving 25 years in prison, has reached an agreement with investors to resolve his civil lawsuit.
- Bankman Freed plans to cooperate in class action lawsuit targeting celebrities who promoted FTX, with the aim of resolving current and future civil claims
- The list of celebrities includes Tom Brady, Shaquille O’Neal, Stephen Curry, Shohei Ohtani, Gisele Bündchen, Larry David, and more
Failed cryptocurrency prodigy Sam Bankman Freed, currently serving a 25-year prison sentence for a massive fraud case, will cooperate in a class action lawsuit against celebrities who promoted his cryptocurrency exchange. agreed.
By agreeing to work with investors, the victims will drop their civil liability claims against the felon founders.
Celebrities include big sports stars like Tom Brady, Shaquille O’Neal, Stephen Curry, and Shohei Ohtani.
Brady’s ex-wife Gisele Bündchen and actor Larry David are also accused of promoting unregistered FTX securities and soliciting investors into the pyramid scheme.
The lawsuit alleges that Cryptocurrency Bankman Freed and the celebrities he has recruited to endorse the company are responsible for approximately $11 billion in losses to U.S. consumers.
Many of the stars were “ambassadors” for the trading platform, and some appeared in prime-time commercials.
Plaintiffs hope they may be able to recoup some of their losses following FTX’s collapse in November 2022.
Bankman Fried, 32, appealed his federal conviction earlier this month after U.S. District Judge Lewis Kaplan set a prison sentence and ordered him to pay $11 billion in forfeiture. did.
In exchange for being removed from the civil suit, Bankman Fried is to hand over all non-privileged documents detailing his assets and investments in artificial intelligence startup Anthro PC, and his net worth is negative. He was to hand over supporting affidavits and documents relating to a wide range of other defendants. This extends to civil litigation.
Bankman Fried also agreed to release all information about the venture capital firms that invested in FTX, as well as a list of accountants and lawyers who worked with the exchange.
Given that Bankman-Fried has paid celebrities to raise the profile of his crypto empire, it is unclear what responsibility the superstar’s supporters bear.
Pro football quarterback Trevor Lawrence was paid $500,000 in September 2022, according to Bloomberg.
The celebrities are listed on page 41 as “parties controlling, promoting, supporting, or actively participating” in FTX’s business, which is suspected of violating Florida law.
The complaint further added that “the deceptive and failed FTX platform was based on false representations and deceptive practices.”
“Although many of the emails and texts incriminating FTX have already been discarded, we have identified them. proves how FTX’s fraud scheme was designed.
“As a result, American consumers suffered total losses of more than $11 billion.”
NFL star Brady and his supermodel ex-wife Bündchen have been named FTX ambassadors and will “participate in the company’s $20 million ad campaign in 2021” and “encourage people they know to join the FTX platform.” Appeared in a commercial for “Project.”
Basketball player Curry appeared in the ad campaign and said that you don’t need to be a crypto expert because “With FTX, you have everything you need to safely buy, sell, and trade cryptocurrencies.” As he said this, a white arrow stood out.
David appeared in FTX’s Super Bowl commercial, playing a series of clueless characters who reject bright ideas throughout history, such as toilets and light bulbs.
The ad then showed David rejecting FTX, followed by the message “Don’t be like Larry.”
Shaquille O’Neal also appeared in an FTX commercial, as did Stephen Curry. Mr. Osaka was the company’s “ambassador.”
“The deceptive FTX platform maintained by the FTX Entities is a veritable castle in the sand, with the FTX Entities using new investor funds obtained through investments in YBA to create It was a Ponzi scheme that shuffled customer funds between entities.” [yield-bearing accounts] And they take out loans to pay interest on the old ones and maintain some semblance of liquidity.
“Part of the scheme employed by the FTX entities includes using major sports and entertainment companies, like these defendants, to raise funds and encourage American consumers to invest. Ta. [yield-bearing accounts]These are primarily offered and sold from the FTX entity’s domestic base here in Miami, Florida, which has funneled billions of dollars into the Deceptive FTX platform to keep the entire scheme alive.
The lawsuit was filed in the United States District Court for the Southern District of Florida.
Bankman Fried rose to the top of the crypto world, becoming a billionaire before the age of 30 and building FTX, a small startup he co-founded in 2019, into the world’s second-largest exchange platform.
However, in November 2022, a flood of customer withdrawals led to the revelation that billions of dollars had been illegally transferred from FTX to Bankman Freed’s personal hedge fund, Alameda Research. The incredible rise has come crashing down.
He was convicted by a federal jury in New York in November 2023 on seven counts of fraud, embezzlement and criminal conspiracy.
At last month’s sentencing hearing, Bankman Fried expressed regret over the company’s demise, which also affected many of his colleagues.
“It bothers me every day,” he said. “I made a series of bad decisions.”
But the judge said Bankman Freed had not fully accepted liability.
Bankman Freed said, “Although a mistake was made, there was not a single word of remorse for having committed such a horrific crime.” Characterizing the offense as “brazen,” Bankman Fried said the SBF had an “extraordinary response to the truth.” said Kaplan, praising the company’s “flexibility.”
“Since the collapse of FTX, Bankman Freed has been particularly focused on returning the estate’s assets to its customers, who can receive full refunds at current prices,” said Bankman Freed spokesman Mark Botnick. It should be returned,” he said.
