Celebrities and sports personalities like Tom Brady, Stephen Curry, and Larry David were implicated in a recent lawsuit from investors impacted by the FTX crash last week.
The formally lodged class action lawsuit against FTX founder Sam Bankman-Fried also names a number of celebrities who were paid to promote the cryptocurrency exchange in various media.
The Straits Times reports that the aforementioned high-profile US sports stars and personalities have been named over deceptive practices targeting investors who became victims of FTX's collapse in the United States.
FTX Investors Sue Celebrities
Oklahoma investor Edwin Garrison filed the lawsuit on behalf of other investors to seek redress for losses incurred as a result of the FTX meltdown, accusing the company of "misrepresentations and omissions."
The FTX incident, according to other crypto platforms, is one of the biggest crypto meltdowns this year and may have severely impacted people's confidence in the digital coin.
The crash even caused a ripple effect in the crypto industry when the value of bitcoin dropped to a two-year low on the same day that FTX sank.
Reports tell us that authorities from multiple countries have already started probing the matter to provide more oversight on the recently shaken crypto industry.
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American football superstar and his supermodel ex-wife Gisele Bundchen, tennis Grand Slam champion Naomi Osaka, NBA champion Stephen Curry, retired NBA great and sports commentator Shaquille O'Neal, Shark Tank investor Kevin O'Leary, and comedian-actor Larry David were some of the names mentioned in the proposed lawsuit alongside the FTX founder.
The suit was filed on Tuesday, Nov. 15, in a Miami court. As per the lawsuit, "American consumers collectively sustained over $11 billion dollars in damages" from FTX.
The complaint alleges that "FTX's fraudulent scheme was designed to take advantage of unsophisticated investors from across the country who utilize mobile apps to make their investments."
Furthermore, the lawsuit states that the FTX scheme utilized the biggest names in sports and entertainment to drive American customers to invest billions of dollars in the platform.
FTX Crash Fallout
The FTX tumble began when Binance, the largest cryptocurrency platform in the world, pulled out of a buyout deal due to reports of client funds being mismanaged and potential regulatory investigations. FTX had previously been valued at US$32 billion.
The collapse of his cryptocurrency exchange and its trading firm, Alameda Research, has rendered the assets virtually useless, according to previous reports.
According to the Washington Post, the US Congress will hold a hearing next month on the collapse of cryptocurrency exchange FTX as Congress intensifies its scrutiny of the broader crypto industry.
Treasury Secretary Janet Yellen expressed concerns that the "recent failure of a major cryptocurrency exchange" should prompt the US government to conduct "more effective oversight," with Congress and the Biden administration working to "fill regulatory gaps."
Stay posted here for the latest updates on the matter.
