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FTX, celebrity endorsers being sued

by Jay Weaver Miami Herald (TNS) | November 17, 2022 at 1:47 a.m.

FTX Exchange, the once high-flying cryptocurrency trader with its name emblazoned on the Miami Heat arena, has been targeted in a new lawsuit that also names 11 of its big-name advertising promoters, including football icon Tom Brady and NBA legend Shaquille O'Neal.

The civil lawsuit filed in Miami federal court is far from the only legal problem for the Bahamas-based company, whose recent filing for bankruptcy has shaken the cryptocurrency markets. The company is already under federal scrutiny for potential securities violations, but also faces a criminal probe.

On Tuesday, Homeland Security Investigations in Miami announced on Twitter that it has an "ongoing criminal investigation" and is seeking information from victims who may have invested in the FTX platform.

The HSI investigation is headed by its El Dorado Task Force South, which specializes in fraud, money laundering and other crimes extending from the United States to foreign countries.

The civil lawsuit filed late Tuesday seeks class-action designation to represent all FTX investors. The lead named defendant is FTX founder Sam Bankman-Fried, a Massachusetts Institute of Technology grad and funds trader, but the lawsuit also seeks damages from nearly a dozen celebrity promoters.

In addition to Brady and O'Neal, other names in the suit are Brady's ex-wife, Gisele Bundchen, Jacksonville Jaguars quarterback Trevor Lawrence, Warriors superstar Stephen Curry, tennis star Naomi Osaka, Angels star Shohei Ohtani and the Golden State Warriors team. Comedian Larry David, the creator of "Seinfeld" and "Curb Your Enthusiasm," is also named.

The suit, filed by attorneys Adam Moskowitz and David Boies, claims they engaged in deceptive practices to sell FTX yield-bearing digital currency accounts.

John J. Ray III, FTX's new chief executive who is not named as a defendant in the lawsuit, declined to comment on the allegations, according to Reuters.

FTX filed for bankruptcy Friday and is facing scrutiny from U.S. authorities amid reports that $10 billion in customer assets were shifted from FTX to Bankman-Fried's trading company, Alameda Research.

When the crypto exchange faltered on liquidity concerns, U.S. investors sustained $11 billion in damages, the new lawsuit says.

Print Headline: FTX, celebrity endorsers being sued


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