Crypto Exchange Goes Bankrupt FTX Sues Founder, What’s Up?

Liputan6.com, Jakarta Bankrupt crypto exchange FTX on Thursday, July 20, 2023 sued its founder, Sam Bankman-Fried (SBF) and other former cryptocurrency exchange executives.

Reporting from Channel News Asia, Monday (24/7/2023), FTX is trying to get back more than USD 1 billion or the equivalent of IDR 15 trillion (assuming an exchange rate of IDR 15,043 per US dollar) which was allegedly misused before FTX went bankrupt.

The lawsuit filed in Delaware bankruptcy court also names as defendants Caroline Ellison, who headed Sam Bankman-Fried’s Alameda Research hedge fund, former FTX Zixiao chief technology officer Gary Wang, and former FTX engineering director Nishad Singh.

FTX said the defendants continued to misuse funds to finance luxury condominiums, political contributions, speculative investments and other projects while committing one of the largest financial frauds in history.

The alleged fraudulent transfers occurred between February 2020 and November 2022 when FTX filed for Chapter 11 protection, and may be canceled or avoided under the US bankruptcy code or Delaware law.

US prosecutors say Bankman-Fried was the mastermind behind the fraud that led to the collapse of FTX and included the misuse of billions of dollars in customer funds. Bankman-Fried has continued to plead not guilty to several criminal charges. Ellison, Wang and Singh pleaded guilty and agreed to cooperate with prosecutors.

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