The FTX bankrupt team is suing former exchange CEO Sam Bankman-Freed and other former executives for buying Embed at an inflated price. This is reported The Block.
Bankman-Fried, FTX co-founder Gary Wang and ex-CTO Nishad Singh knew, lawyers said, that by the time the acquisition of the clearing service was completed in September 2022, the exchange and its affiliate, Alameda Research, were already insolvent.
FTX/Alameda executives fraudulently used customer funds to purchase the platform for nearly $250 million, according to the filing.
Separate lawsuits have been filed by FTX managers against Embed founder Michael Giles and the early investors who sold their stakes in the deal. The defendants were required to return the funds received, without accusing them of committing criminal offenses.
Lawyers noted that the acquisition of Embed was carried out without proper conduct due diligence. The purchase turned out to be “useless” as the clearing platform did not match the declared functionality at all.
Giles’ share was $157 million, while the founder, who served as CEO of Embed, received an additional “extravagant and unreasonable” bonus for continuing to work. The payout was $55 million with no real commitment from Giles to remain in office, FTX executives said.
In January, the court allowed FTX to sell business units to raise liquidity for settlements with creditors.
According to lawyers, the auction on the clearing platform showed how inflated the purchase price was. During the auction, Giles himself offered the highest bid of $1 million.
Recall that the US Attorney’s Office incriminates Bankman-Fried for 13 criminal offenses. In May, lawyers for the ex-CEO of FTX asked the court to drop almost all charges.
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The FTX bankrupt team is suing former exchange CEO Sam Bankman-Freed and other former executives for buying Embed at an inflated price. This is reported The Block.
Bankman-Fried, FTX co-founder Gary Wang and ex-CTO Nishad Singh knew, lawyers said, that by the time the acquisition of the clearing service was completed in September 2022, the exchange and its affiliate, Alameda Research, were already insolvent.
FTX/Alameda executives fraudulently used customer funds to purchase the platform for nearly $250 million, according to the filing.
Separate lawsuits have been filed by FTX managers against Embed founder Michael Giles and the early investors who sold their stakes in the deal. The defendants were required to return the funds received, without accusing them of committing criminal offenses.
Lawyers noted that the acquisition of Embed was carried out without proper conduct due diligence. The purchase turned out to be “useless” as the clearing platform did not match the declared functionality at all.
Giles’ share was $157 million, while the founder, who served as CEO of Embed, received an additional “extravagant and unreasonable” bonus for continuing to work. The payout was $55 million with no real commitment from Giles to remain in office, FTX executives said.
In January, the court allowed FTX to sell business units to raise liquidity for settlements with creditors.
According to lawyers, the auction on the clearing platform showed how inflated the purchase price was. During the auction, Giles himself offered the highest bid of $1 million.
Recall that the US Attorney’s Office incriminates Bankman-Fried for 13 criminal offenses. In May, lawyers for the ex-CEO of FTX asked the court to drop almost all charges.
Found a mistake in the text? Select it and press CTRL+ENTER
Cryplogger Newsletters: Keep your finger on the pulse of the bitcoin industry!