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These Celebrities Are Being Sued After the FTX Collapse

These Celebrities Are Being Sued After the FTX Collapse
These Celebrities Are Being Sued After the FTX Collapse

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Celebrities that promoted the now-bankrupt FTX cryptocurrency exchange are being sued as part of a class-action lawsuit accusing FTX and its promoters of using deceptive means of persuading people to invest in the exchange. Some celebrities involved in this lawsuit include Giselle Búndchen, Larry David, Shaquille O’Neal, Stephen Curry, and Tom Brady.

Celebrities named in FTX class-action lawsuit

The class-action lawsuit was filed on November 15 at the Florida federal district court. The plaintiff, Edwin Garrison, who resides in Oklahoma and was a user of the FTX exchange, is seeking to represent the US customers affected by the collapse of FTX.

According to this lawsuit, FTX and its former CEO, Sam Bankman-Fried, used celebrities to attract naïve investors into the exchange to keep the money flowing. The plaintiff said that FTX used some of the biggest names in the sports and entertainment sector to pursue more US customers to invest in the platform.

The plaintiff had invested money in the FTX yield-bearing account. According to the lawsuit, this product violated the securities laws in Florida and at the federal level. The lawsuit is seeking monetary damages, claiming that the collapse of FTX caused a loss of over $11 billion to consumers.

The lawsuit said that Larry David was featured in an ad for the exchange dubbed “Don’t Miss Out on Crypto.” This ad appeared during the 2022 Super Bowl. This was the only Super Bowl commercial that David had ever featured in.

The lawsuit describes how David promoted FTX in the ad. It displayed the comedian as a skeptic of everything, including FTX, while cautioning viewers not to be like David and invest in FTX.

American football quarterback Tom Brady and his now ex-wife Búndchen have also been mentioned in the lawsuit. In 2021, the two appeared in an ad for the FTX exchange titled “FTX. You In.” in this ad, the two encouraged viewers to invest in crypto with the platform.

The other celebrities in this lawsuit include David Ortiz, Naomi Osaka, Kevin O’Leary, William Trevor Lawrence, and Udonis Haslem. The Golden State Warriors has also been named a defendant following a partnership deal with FTX earlier this year.

According to the lawsuit, Kevin O’Leary, a celebrity investor at Shark Tank, was either involved in controlling, promoting, assisting, or actively participating in the operations of the FTX exchange.

The lawsuit describes FTX as a “house of cards” where entities affiliated with the exchange used customer funds to support their operations. The company also used funds brought in by new investors in the yield-bearing accounts and loans to pay interest to the old investors to make it seem like they were still solvent.

FTX’s bankruptcy

FTX filed for bankruptcy on Friday last week. During the bankruptcy filing, Bankman-Fried also resigned as the exchange’s CEO. The company that once had $50 billion in assets had a deficit of $8 billion in assets by the time it filed for bankruptcy.

The SEC and the US Justice Department have investigated the exchange’s collapse. Meanwhile, FTX CEO recently interviewed with Vox, saying that he regrets filing for bankruptcy, saying that “messy accounting” created the situation.

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