As the FTX crypto exchange crumbles, investors are not only going after the company but after the celebrities who endorsed it.
In the lawsuit filed against FTX founder Sam Bankman-Fried, several big names are attached to the scheme. Famous athletes, including Shaquille O’Neal, Tom Brady, and tennis star Naomi Osaka were tapped to help promote the crypto exchange, which is alleged to have stolen over $11 billion from American consumers who invested in it, some of which were employees of the company. Steph Curry and the entire Golden State Warriors also helped push the GEN-Z crypto platform to popularity.
Legal action does not come as a surprise, considering the swift downfall of FTX. Days ago, they announced that they’d filed for bankruptcy and had to break the news to investors, many of which were inexperienced in crypto, that they could not get their money back.
One of the biggest accusations is that Bankman-Fried invested the deposits of crypto account holders on the exchange. He has denied this claim but did admit to Vox that Alameda Research, his trading firm, had “borrowed” excessive amounts of money from FTX’s balance sheet for investments. He claims he did not realize this was happening until it was too late.
In the suit, filed by Boies Schiller Flexner and the Moskowitz Law Firm in Florida Southern District Court, FTX is called a “Ponzi scheme” that transferred customer funds between its multiple affiliate companies.
In the wake of the lawsuit, Bankman-Fried admitted to becoming “overconfident and careless.”
20) I was on the cover of every magazine, and FTX was the darling of Silicon Valley.
We got overconfident and careless.
— SBF (@SBF_FTX) November 16, 2022