FTX customers file class action to lay claim to dwindling assets
贵罢齿听肠耻蝉迟辞尘别谤蝉听filed a听肠濒补蝉蝉听补肠迟颈辞苍听lawsuit against the failed crypto exchange and its former top executives including Sam Bankman-Fried on Tuesday, seeking a declaration that the company’s holdings of digital听补蝉蝉别迟蝉听belong to听肠耻蝉迟辞尘别谤蝉.
The lawsuit is the latest legal effort to听濒补测听肠濒补颈尘听to the听诲飞颈苍诲濒颈苍驳听补蝉蝉别迟蝉听of听贵罢齿, which is聽聽with liquidators in the Bahamas and Antigua as well as the bankruptcy estate of Blockfi, another failed crypto company.
贵罢齿听pledged to segregate customer accounts and instead allowed them to be misappropriated and therefore聽肠耻蝉迟辞尘别谤蝉听should be repaid first, according to the lawsuit听蹿颈濒别d in U.S. Bankruptcy Court in Delaware.
“Customer听肠濒补蝉蝉听members should not have to stand in line along with secured or general unsecured creditors in these bankruptcy proceedings just to share in the diminished estate听补蝉蝉别迟蝉听of the聽贵罢齿听Group and Alameda,” said the complaint.
贵罢齿听did not immediately respond to a request for comment.
Bahamas-based聽贵罢齿听halted withdrawals last month and听蹿颈濒别d for bankruptcy after聽肠耻蝉迟辞尘别谤蝉听rushed to pull their holdings from the what was once the second-largest cryptocurrency exchange after questions surfaced about its finances.
Bankman-Fried faces charges stemming from what a federal prosecutor called a “fraud of epic proportions” that included allegedly using customer funds to support his Alameda Research crypto trading platform.
Bankman-Fried has acknowledged risk-management failures at聽贵罢齿听but said he does not believe he has criminal liability. He has not yet entered a plea and was released on a $250 million bond last week that included restrictions on his travel.
The proposed听肠濒补蝉蝉, which wants to represent more than 1 million聽贵罢齿听肠耻蝉迟辞尘别谤蝉听in the United States and abroad, seeks a declaration that traceable customer听补蝉蝉别迟蝉听are not聽贵罢齿听property. The customer听肠濒补蝉蝉听also wants the court to find specifically that property held at Alameda that is traceable to聽肠耻蝉迟辞尘别谤蝉听is not Alameda property, according to the complaint.
The lawsuit seeks a declaration from the court that funds held in聽贵罢齿听U.S. accounts for U.S.聽肠耻蝉迟辞尘别谤蝉听and in聽贵罢齿听Trading accounts for non-U.S.聽肠耻蝉迟辞尘别谤蝉听or other traceable customer听补蝉蝉别迟蝉听are not聽贵罢齿听property. The customer听肠濒补蝉蝉听also wants the court to find specifically that property held at Alameda that is traceable to聽肠耻蝉迟辞尘别谤蝉听is not Alameda property, according to the complaint.
If the court determines it is聽贵罢齿听property, then the聽肠耻蝉迟辞尘别谤蝉听seek a ruling that they have a priority right to repayment over other creditors.
Crypto companies are lightly regulated and often based outside the United States and deposits are not guaranteed as U.S. bank and brokerage deposits are,聽聽of whether the company or聽肠耻蝉迟辞尘别谤蝉听own the deposits. – Reuters
