Tech

FTX’s Sam Bankman-Fried, Other Celebrity Promoters Sued by Crypto Investors


U.S. crypto investors have sued FTX founder Sam Bankman-Fried and several celebrities for promoting his exchange, including NFL quarterback Tom Brady and comedian Larry David, claims that they have engaged in fraudulent activities to sell profitable digital currency accounts FTX.

The proposed class action lawsuit filed Tuesday night in Miami alleges that FTX Profitable accounts are unregistered securities that have been illegally sold in the United States.

FTX has filed for bankruptcy and is facing scrutiny from the US authorities amid reports that $10 billion (nearly Rs 81,500) in customer assets has been transferred from FTX to the company. Bankman-Fried’s Alameda Research trade.

At least $1 billion in client funds is missing, sources told Reuters.

As the crypto exchange faltered due to liquidity concerns, US investors suffered $11 billion in losses (nearly Rs 8,140 crore), the lawsuit said.

The lawsuit seeks damages from Bankman-Fried and 11 other athletes and celebrities who promoted FTX, including David, the creator of “Seinfeld” and “Curb Your Enthusiasm.”

David starred in a commercial for FTX that aired during Super Bowl 2022, in which he played fictional characters that refute key innovations throughout history and ended with the message “Don’t give up” miss cryptocurrencies”.

Brady, tennis star Naomi Osaka and professional basketball team Golden State Warriors are also defendants in the lawsuit.

Representatives for Bankman-Fried, Brady, Osaka, David and the Golden State Warriors did not immediately respond to requests for comment on Wednesday.

John J Ray III, the new chief executive officer of FTX, who was not named as a defendant in the lawsuit, declined to comment on the allegations.

The lawsuit is brought on behalf of Edwin Garrison, an Oklahoma resident whose FTX yielding account he funds with crypto assets for interest, and others like him.

Garrison alleges that while FTX lures US investors into profitable accounts, it is a “Ponzi scheme” in which investors’ funds are shuffled to related entities. important to maintain liquidity.

Investors and the US Securities and Exchange Commission have previously pursued celebrities for fraudulently touting cryptocurrencies.

Reality TV star Kim Kardashian in February agreed to pay the SEC $1.26 million (nearly Rs. 10 crore) to settle a complaint that she failed to disclose that she was paid to promote EthereumMax tokens. She did not admit wrongdoing.

Private investors have also sued Kardashian and others over their role in promoting the token.

Garrison cited these circumstances in his lawsuit, as well as the February 11th U.S. Court of Appeals ruling allowing crypto investors BitConnect to sue individuals who promoted the coin. online.

His lawsuit alleges Bankman-Fried and the promoters of FTX engaged in a conspiracy to defraud investors and violated Florida state law that requires securities to be registered and prohibits business activities. unfair business.

Sean Masson, an attorney at Scott + Scott who represented crypto investors in the EMAX lawsuit, said investors used Florida’s unfair trade laws to target investors. promote cryptocurrencies in pending lawsuits.

“To be successful, they will need to prove fraudulent or unfair conduct and that conduct causes actual harm,” Masson said.

© Thomson Reuters 2022


Affiliate links can be generated automatically – see ours Moral standards for details.

news7f

News7F: Update the world's latest breaking news online of the day, breaking news, politics, society today, international mainstream news .Updated news 24/7: Entertainment, Sports...at the World everyday world. Hot news, images, video clips that are updated quickly and reliably

Related Articles

Back to top button