Investors in FTX, Sam Bankman-Fried’s bankrupt crypto company, have agreed to drop their lawsuits against the convicted fraudster in exchange for his cooperation in prosecutions of other defendants, including celebrities Tom Brady, Gisele Bundchen and Larry David who promoted the company before its resounding collapse.
Under the settlement — filed Friday by a group of FTX investors in Miami federal court — Bankman-Fried would be released from any civil liability arising from the multi-district litigation, now and in the future, according to Bloomberg.
As part of the proposed settlement, which still must be approved by a judge, Bankman-Fried agreed to turn over all non-privileged documents detailing his assets and investment in Anthropic, an artificial intelligence startup backed by Google and Amazon, a affidavit certifying his net worth as negative and documents on other defendants in the lawsuits, Bloomberg reported.
Bankman-Fried is also ready to provide the FTX investor group with all possible information about the accountants, lawyers and venture capitalists who worked with his disgraced exchange, which collapsed in November 2022 after Bankman-Fried stole user funds to plug an $8. billion dollars in debt at its sister company Alameda Research.
NFL legend Brady, his ex-wife Gisele Bundchen and “Curb Your Enthusiasm” star David, along with Steph Curry, Shaquille O’Neill and Naomi Osaka have appeared in ads promoting FTX and are fighting lawsuits brought by shareholders.
More than a dozen nationally and internationally based venture capital firms are also battling litigation over their involvement with FTX.
The list of defendants at the center of a series of lawsuits filed in the wake of FTX’s implosion accuses each endorser of promoting the exchange’s unregistered securities and luring investors into a Ponzi scheme, according to Bloomberg.
Last month, Bankman-Fried, 32, was sentenced to 25 years in prison.
Bankman-Fried’s co-defendants and fellow FTX insiders, including his ex-girlfriend Caroline Ellison, who also worked as the head of hedge fund firm Alameda Research, FTX co-founder Gary Wang and former company executive Nishad Singh, also agreed to settle, according to Bloomberg.
Ellison, Wang and Singh – who testified against Bankman=Fried – along with FTX lawyer Dan Friedberg, began passing along information to help investors.
Social media celebrities who have promoted FTX – including financial YouTubers Andrei Jikh, Graham Stephan, Jaspreet Singh, Tom Nash, Brian Jung and Jeremy Lefebvre – have also struck a deal, agreeing to contribute to a pooled fund of $1 $.4 million to fund the plaintiffs’ lawsuit, according to court documents.
The settlements with the developers are valued at approximately $1.3 million, according to a filing in the case.
Adam Moskowitz, the attorney for the FTX investor group, did not immediately respond to The Post’s request for comment.
The settlement agreement was signed by Bankman-Fried on April 11 – the same day he appealed his conviction and 25-year prison sentence.
Defense attorney Marc Mukasey had announced his intention to appeal to the Manhattan-based U.S. Court of Appeals for the Second Circuit during Bankman-Fried’s sentencing hearing, on March 28.
Bankman-Fried was convicted of seven counts of fraud and conspiracy in what federal prosecutors called one of the largest financial frauds in U.S. history.
New York Post
