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FTX Executives Settle Class Action Lawsuit
Several FTX executives have agreed to settle a class action lawsuit following founder Sam Bankman-Fried’s sentencing yesterday.
Details of the Settlement
Former head of engineering for FTX, Nishad Singh, Alameda Research CEO Caroline Ellison, chief technological officer for FTX, Gary Wang, and seven promoters of the bankrupt exchange have all agreed to forfeit a total sum of $1.3 million following claims that they participated in and perpetuated ringleader Sam Bankman-Fried’s multi-billion dollar fraud on FTX customers.
In addition to having “pled guilty in the criminal proceedings against them,” FTX insiders “have agreed to full restitution and forfeiture” of the designated sum.
Judge’s Decision
The agreement will allow Judge Lewis A. Kaplan, who presided over the U.S. government’s case over Sam Bankman-Fried case, to decide “how the FTX victim funds recovered from them will be provided to the FTX victims.”
Sam Bankman-Fried Sentenced
The FTX lawsuit agreement follows Bankman-Fried’s March 28 sentencing hearing in Manhattan federal court that saw the now disgraced FTX founder sentenced to 25 years in prison.
Financial Penalty
In addition to his lengthy sentence, Bankman-Fried has been ordered to pay over $11 billion in forfeiture.
Bankruptcy Estate Challenges
Meanwhile, the FTX bankruptcy estate continues to trudge through numerous legal challenges, most recently acquiring Unabomber prosecutor Robert J. Cleary to investigate law firm Sullivan and Cromwell’s potential conflicts of interest with the crypto exchange.
Bankman-Fried has been ordered to live out his sentence in a medium-security prison given in part to his connection to “vast wealth.” He has two weeks from the date of the court’s judgment submission to appeal the case.
Ian is a cryptocurrency enthusiast blending humor with professionalism. With an engineering background and a storyteller's heart, he simplifies the blockchain world with sharp analysis and a touch of wit. At Cryptowire, he brings his unique perspective to make digital financial innovation accessible to all.
