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he saga surrounding the collapse of crypto firm FTX took one other twist at the moment after the bankrupt enterprise unveiled a recent lawsuit towards its former boss Sam Bankman-Fried in a bid to recoup a whole lot of thousands and thousands of {dollars}.
The lawsuit alleges that Bankman-Fried, together with various different senior members of FTX together with co-founder Gary Wang, participated in fraudulent transactions for their very own private profit. That features the pair having allegedly taken $546 million from Alameda Analysis, their privately-held crypto hedge fund, to purchase shares in one other buying and selling app, Robinhood, in addition to utilizing faux loans to amass shares in FTX that had been value $250 million.
The authorized motion, which has been filed on the US Chapter Court docket in Delaware, is a part of efforts by FTX’s new CEO John Ray to recuperate funds that can be utilized to repay collectors, together with prospects who have been frozen out of their crypto accounts after the corporate went bust in November final yr.
“Defendants abused their management over the FTX Group to commit one of many largest monetary frauds in historical past,” the lawsuit claims.
“Defendants misappropriated Debtor funds on a steady foundation to finance luxurious condominiums, political and “charitable” contributions, speculative investments and different pet initiatives.
“They commingled and misused company and buyer funds, lied to 3rd events in regards to the enterprise of the FTX Group, joked internally about their tendency to lose monitor of thousands and thousands of {dollars} in property and impulsively purchased corporations with misappropriated funds.”
In December, the US securities regulator charged FTX founder Sam Bankman-Fried with orchestrating a scheme to defraud buyers.
The Securities and Alternate Fee has accused Bankman-Fried of being behind a years-long effort to hide from buyers the undisclosed diversion of FTX prospects’ funds to Alameda.
SEC director Gurbir Grewal stated: “FTX operated behind a veneer of legitimacy Mr. Bankman-Fried created by, amongst different issues, touting its best-in-class controls, together with a proprietary ‘danger engine,’ and FTX’s adherence to particular investor safety rules and detailed phrases of service.
“However as we allege in our grievance, that veneer wasn’t simply skinny, it was fraudulent.”
