FTX founder Sam Bankman-Fried and celebrities who endorsed the platform hit by $11B suit

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FTX founder Sam Bankman-Fried and a string of A-list celebrities who supported his failed crypto trading platform have been sued in an $11 billion class action lawsuit.

The lawsuit filed in Florida names stars such as Tom Brady, Gisele Bundchen, Shaquille O’Neal, Steph Curry and Larry David.

It alleges that Bankman-Fried, 30, and the celebrities he recruited to endorse FTX are responsible for US consumer losses worth $11 billion.

Many of the stars were “ambassadors” of the trading platform, while others appeared in prime-time commercials.

The lawsuit, brought by class action attorney Adam Moskowitz, alleges that they are collectively “responsible for the multibillion-dollar damages they have inflicted on Plaintiff.”

It was submitted as Bankman-Fried continued a desperate attempt to save his reputation on Wednesday by admitting: “We became overconfident and careless.”

Bankman Fried and several of his celebrities are being sued in a class action lawsuit alleging that the collapse of FTX cost American consumers $11 billion

Bankman Fried and several of his celebrities are being sued in a class action lawsuit alleging that the collapse of FTX cost American consumers $11 billion

Tom Brady and now ex-wife Gisele Bundchen entered into a stock deal with FTX last year.  They are named in a class action lawsuit alleging that the company's collapse cost consumers $11 billion

Tom Brady and now ex-wife Gisele Bundchen entered into a stock deal with FTX last year. They are named in a class action lawsuit alleging that the company’s collapse cost consumers $11 billion

Naomi Osaka took an equity stake in the popular crypto exchange in March this year

Naomi Osaka took an equity stake in the popular crypto exchange in March this year

He posted several tweets trying to explain how FTX crashed and even spoke about the company’s extensive media coverage earlier this year, writing, “I was on the cover of every magazine and FTX was Silicon Valley’s darling.” ‘

Bankman-Fried has already been subject to several investigations into the company’s collapse.

Authorities in America and the Bahamas, where FTX was based and Bankman-Fried is currently hiding, are discussing the possibility of extraditing him to the United States for questioning.

The scandal has led to a crisis of confidence in cryptocurrency as a whole and has caused the value of assets, including Bitcoin, to plummet.

The list of names in the new filing includes: ‘Sam Bankman-Fried, Tom Brady, Gisele Bundchen, Stephen Curry, Golden State Warriors, Shaquille O’Neal, Udonis Haslem, David Ortiz, William Trevor Lawrence, Shohei Ohtani, Naomi Osaka, Lawrence Gene David and Kevin O’Leary.”

They are described in the 41 pages as “parties that controlled, promoted, assisted and actively participated in FTX’s operations,” allegedly in violation of Florida law.

The suit adds: “The misleading and failed FTX platform was based on false representations and deceptive behavior.

While many incriminating FTX emails and texts have already been destroyed, we found them and they prove how FTX’s fraudulent scheme was designed to take advantage of inexperienced investors across the country, who use mobile apps to manage their investments. to do.

1668630580 313 FTX founder Sam Bankman Fried and celebrities who endorsed the platform

Bankman-Fried suggested media coverage of FTX made the company

Bankman-Fried suggested media coverage of FTX made the company “overconfident and careless”

Steph Curry signed a partnership with FTX in September 2021, though details were not made public

Steph Curry signed a partnership with FTX in September 2021, though details were not made public

Schumer and her husband join several A-listers in the affluent community that is home to homeowners Larry David, Oprah Winfrey, Ellen DeGeneres, and perhaps most notably Prince Harry and Meghan Markle

Larry David, who appeared in a Super Bowl ad for FTX, is also named in the lawsuit

“As a result, U.S. consumers collectively suffered more than $11 billion dollars in damages.”

NFL star Brady and Bundchen, his supermodel ex-wife, are named as FTX ambassadors who “joined the company’s $20 million ad campaign in 2021” and starred in a commercial “showing they acquaintances told to join the FTX platform’.

Basketball player Curry is singled out for appearing in an ad campaign saying he doesn’t need to be an expert in crypto, because “with FTX I have everything I need to buy, sell and trade crypto securely.”

David appeared in a Super Bowl commercial for FTX, portraying a series of ignorant characters who rejected clever ideas throughout history, including the toilet and the light bulb.

The ad then showed David rejecting FTX, before displaying a message: “Don’t be like Larry.”

Basketball legend Shaquille O'Neal, who appeared in an FTX commercial, is named in the suit

Basketball legend Shaquille O’Neal, who appeared in an FTX commercial, is named in the suit

Shaquille O’Neal also appeared in an FTX commercial, as did Steph Curry. Osaka was an “ambassador” for the company.

The lawsuit states, “The deceptive FTX platform operated by the FTX entities was really a house of cards, a Ponzi scheme where the FTX entities shuffle client funds between their opaque affiliates, using new investor funds obtained through investments in the YBAs [yield-bearing accounts] and loans to pay interest on the old and to try to maintain the appearance of liquidity.

“Part of the scheme employed by the FTX entities involved using some of the biggest names in sports and entertainment — such as these defendants — to raise funds and induce American consumers to invest in the [yield-bearing accounts]which were largely offered and sold from the domestic base of the FTX entities here in Miami, Florida, poured billions of dollars into the deceptive FTX platform to keep the whole scheme going.”

The lawsuit was filed in Florida’s Southern District as Bankman-Fried continued his desperate efforts to save his empire.

In a series of tweets on Wednesday, he complained that FTX was “getting overconfident and careless,” writing, “I was on the cover of every magazine and FTX was Silicon Valley’s darling.”

The thread also said, “A few weeks ago, FTX was processing ~$10B/day in volume and billions of transfers.

“But there was too much influence—more than I realized. A run on the bank and a market crash deplete liquidity.

‘So what can I try to do? Increase liquidity, complete customers and reboot.

“Maybe I fail. Maybe I’m not getting more for clients than what’s already there.

“I’ve definitely failed before. You all know that all too well now.

‘But all I can do is try. I’ve failed enough for the month.

“And part of me thinks I can get somewhere.”

Timeline of the meteoric rise and rapid demise of crypto exchange FTX

Cryptocurrency exchange FTX has collapsed.

Here is a history of FTX since its inception in 2019:

2019:

Be able to – Former Wall Street trader Sam Bankman-Fried and ex-Google employee Gary Wang founded FTX, the owner and operator of FTX.COM cryptocurrency exchange.

2020:

august – FTX acquired the mobile portfolio tracking application, Blockfolio, for $150 million.

2021:

july – A $900 million funding round valued FTX at $18 billion.

September – FTX signed a sponsorship deal with the Mercedes Formula 1 team.

October – FTX raised capital at a valuation of $25 billion from investors including Singapore’s Temasek and Tiger Global.

2022:

January 27 – FTX’s US arm said it was valued at $8 billion after raising $400 million in its first round of funding from investors including SoftBank and Temasek.

January 31st – FTX raised $400 million from investors including SoftBank at a valuation of $32 billion.

February 13 – Larry David stars in Super Bowl commercial for FTX

April 26 – April 29 – Bankman-Fried is joined by celebrities such as Tom Brady, Katy Perry, Tony Blair and Bill Clinton and the Crypto Bahamas conference.

June 4 – FTX reportedly signed a $135 million sponsorship deal for the Miami Heat home court naming rights.

July 1st – FTX signed a deal with an option to buy controversial crypto lender BlockFi for up to $240 million.

July 22 – FTX offered a partial bailout of bankrupt cryptocurrency lender Voyager Digital. Voyager called it a “low-ball bid.”

July 29 – FTX said it has received full approval to operate its exchange and clearing house in Dubai.

August 19 – A US banking regulator has ordered crypto exchange FTX to end “false and misleading” claims about whether funds at the company are government-insured.

September 9th – FTX’s venture capital fund said it would buy a 30% stake in SkyBridge Capital.

November 2nd – Crypto news website CoinDesk reported a leaked balance sheet showing that Alameda Research, Bankman-Fried’s crypto trading company, relied heavily on FTX’s proprietary token, FTT.

November 6 – Binance CEO Changpeng Zhao said his company would liquidate its stakes in FTT due to unspecified “recent revelations.”

November 7th – Bankman-Fried said, “FTX is fine. Assets are fine’.

November 8 – FTT collapses 72% as customers flood the exchange with withdrawal requests. Binance is offering a potential bailout in a non-binding deal.

November 9 – Binance is pulling out of the rescue plan, saying: “As a result of corporate investigations, as well as the latest news reports of mishandled client funds and alleged US agency investigations, we have decided that we will not pursue the potential acquisition of FTX. com.’

November 11 – Bankman-Fried resigns as CEO and FTX files for Chapter 11 bankruptcy

November 13 Police in the Bahamas announce that a team from the Financial Crimes Investigation Branch is investigating whether criminal misconduct has occurred.

November 15 – Bankman-Fried continues to beg investors for money to cover the company’s losses, tweeting that he is ‘meeting face-to-face with regulators and working with the teams to do what we can for clients’