From the beginning it was clear that the bankruptcy of exchange by Sam Bankman-Fried, FTXIt was going to give a lot to talk about. And so it is being. As it will be with Silicon Valley Bank, Silvergate or Signature. The latest chapter, in the FTX case, is a $1 billion lawsuit filed against several influencers who collaborated with the cryptocurrency exchange platform.
The lawsuit is filed in the United States District Court for the Southern District of Miami.
In it, it is pointed out that “the FTX disaster is the largest financial fraud in US history. His former FTX CEO, Sam Bankman-Fried, faces numerous criminal charges and the new CEO, who helped take down Enron, concluded that this fraud was worse than Enron. Trillions of dollars have been stolen from investors around the world.”
They also emphasize in the letter that “there is no guarantee that any of the victims will be able to see any recovery from these procedures.”
The only way for FTX victims to recover what they lost
They state in the complaint that this action may be one of the only ways for victims to recover their losses. The plaintiffs bring this action against YouTube, the influencers social media finance and promoters who shared financial advice and actively promoted FTX and its profitable accounts (YBA) among his millions of followers.
Although FTX, the brief continues, paid the defendants handsomely to promote their brand and encourage their followers to invest, they did not disclose the nature and extent of their sponsorships and/or sponsorship agreements, payments and compensation,
Evidence has been discovered, they point out, that reveals that the influencers they played a big role in the FTX disaster and, in fact, the exchange It would not have grown so much without the massive impact of these people, they say.
The law protects them
It is of the utmost importance, they indicate, to understand that Florida state law states that these actions do not require “reliance” or “deception.” It simply requires that plaintiffs suffered damages from purchasing an unregistered security and that it was promoted by defendants for their financial benefit or the financial benefit of FTX.
Many of these influencers from FTX, they point out, have apologized ever since, because they rely on their supposed independence and impartiality to attract people to join their fan base.
Defendants assert, “endorsed and promoted the sale of the FTX and none of them disclosed, in any of their YouTube and other social media posts, that FTX paid them hundreds of thousands or millions of dollars and they profited from the sale of FTX, in clear violation of the SEC, FTC, and various federal and state regulations“.
Who are the influencers accused
As mentioned in the lawsuit, these are the 10 influencers defendants:
- Kevin Paffrath: 1.85 million followers on YouTube.
- Graham Stephan: 4.1 million subscribers to his YouTube pages.
- Andrei Jikh – 2.2 million subscribers.
- Jaspreet Singh: 1.4 million.
- Brian Jung: 1.3 million.
- Jeremy Lefebvre: 700,000 subscribers.
- Tom Nash: 283,000 subscribers.
- Ben Armstrong: 1.5 million.
- Creators Agency – A talent management company and digital ad network that promoted FTX.
- Erika Kullberg: One of the founders of Creators Agency LLC, with 18 million followers on social media.