Kevin O'Leary, a well-known investor, Shark Tank judge, and CNBC contributor, said on Thursday, Dec. 8, that he had lost the whole $15 million that FTX had compensated him as a paid ambassador for the now-defunct cryptocurrency exchange.
This news is unhelpful for the company, as some have already dubbed it fraudulent, according to CNBC.
O'Leary's Take
Investors in the crypto exchange FTX have filed a lawsuit against O'Leary and other celebrities, including Tom Brady and Larry David.
The filed cases indicate that these ambassadors for the company should have conducted more research and been more cautious before promoting the business.
The hosts of CNBC's Squawk Box confronted the Canadian investor about his inability to examine the dangers connected with investing and promoting FTX adequately.
O'Leary said he was a victim of "groupthink," even though he and his partners had not suffered any financial losses.
He further explained on CNBC's Squawk Box Thursday episode that the total amount was $15 million.
"I put about $9.7 million into crypto. I think that's what I lost. I don't know. It's all at zero."
In addition, O'Leary said that he had over $1 million in FTX stock, all of which had been wiped out by the filing for bankruptcy. According to him, the remaining $4 million was swallowed up by taxes and commissions.
O'Leary concluded that the investment was a bad one.
Ties With FTX
O'Leary has been actively promoting FTX on Twitter and other online platforms, boasting about his close relationship with the company's infamous founder Sam Bankman-Fried, who is the subject of various investigations.
Initially, O'Leary's promotion of FTX centered on his interest in the crypto exchange because of its compliance processes.
On LinkedIn and in a tweet from August 2021 that he has since removed, O'Leary bragged, "Finally solved my compliance problems with #cryptocurrencies."
Fraud Accusation
In these recent events, founder and ex-CEO Bankman-Fried was the only one to take the blame after the dust cleared.
Some attorneys said many years in prison might be in store for him if he is found guilty of fraud, as previously reported by Tech Times. For the time being, he has not been charged with anything.
If his millions of creditors had proven that he had committed fraud, he would have to face the penalties.
Richard Levin of Nelson Mullins Riley & Scarborough said that Bankman-Fried faces multiple legal liabilities in the US.
The first would be a "criminal action" to bypass US Department of Justice fraud regulations. If the FTX founder is charged with criminal fraud, prosecutors must show "beyond a reasonable doubt" that he committed the crime.
Even though Bankman-Fried denied fraud, he might face "civil enforcement action." Levin added that the state banking authorities, Commodity Futures Trading Commission, and Securities Exchange Commission would handle this.
Meanwhile, Al Jazeera reported that Bankman-Friend has agreed to go before a US House Committee to give testimony. He said that he had done studying and evaluating everything related to the FTX breakdown in November.
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