FTX, the defunct cryptocurrency exchange, has sued its own founder Sam Bankman-Fried and three former executives to recover over $1 billion they are accused of misappropriating before the collapse of FTX last year.
The lawsuit has been reportedly brought by FTX under the guidance of a restructuring expert named John Ray. It targets a series of share awards, real estate acquisitions and cash transfers among others that the company, currently undergoing a restructuring process, says should be undone in accordance with the US bankruptcy law.
Other than the FTX founder Sam Bankman-Fried, Caroline Ellison, the former head of FTX’s trading arm Alameda Research is among the individuals accused of benefiting from the transactions in the lawsuit.
One incident cited in the complaint involves Ellison reportedly granting herself a $22.5 million bonus, part of which was later transferred to a personal bank account and then invested in an Artificial Intelligence company, Financial Times reported.
Zixiao “Gary” Wang, a co-founder of FTX, and Nishad Singh, who worked at FTX and Alameda, are also named as beneficiaries of the purportedly illicit money transfers.
Ellison, Wang, and Singh have already pleaded guilty to unrelated fraud charges in criminal cases, while Bankman-Fried has pleaded not guilty to US criminal charges that include fraud, money laundering, and campaign finance violations.
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