Bankrupt crypto exchange FTX continues to hunt entities that received large donations from SBF.
Cryptocurrency exchange FTX has opened legal proceedings against former business associates. The crypto exchange seeks to recover around $800 million through a lawsuit filed on June 22nd in the United States Bankruptcy Court for the District of Delaware.
Among the named defendants are investment and incubator company K5 Global, SGN Albany Capital, and Mount Olympus Capital, including co-owners of K5 Global, Michael Kives and Bryan Baum.
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Michael Kives, known for his former roles at the CAA talent agency and as an assistant to Hillary Clinton, reportedly hosted a dinner party in 2022 attended by Sam Bankman-Fried (SBF), the then-CEO of FTX.
According to the lawsuit, Alameda Research, an FTX-affiliated crypto trading firm, transferred around $700 million to Baum, Kives and K5 Global. Therefore, with the suit, FTX aims to recover funds moved through Alameda Research to SGN Albany Capital, Kives, Baum.
The lawsuit describes the transactions as executed “without receiving equivalent value” and as transactions that could have been avoided.
Furthermore, the lawsuit details personal connections between Kives, Baum, and Bankman-Fried. These connections ran so deep that Baum was reported to have its own room in Sam Bankman-Fried's residence in the Bahamas. Based on the lawsuit:
Kives and Baum worked behind the scenes with Bankman-Fried on a strategy to find someone to bail out the FTX Group (and to protect their golden goose).
When commenting on the allegations, a K5 Global spokesperson noted that the lawsuit comes "without merit."
K5 was under the impression – like many others – that SBF was completely legitimate and they were entering into a fair, long-term, and mutually beneficial business relationship. Our belief is that the lawsuit is without merit.
FTX’s legal action aims to claw back a significant portion of the funds in an attempt to right the alleged wrongs committed by former business partners and associates.
It is worth noting that in May, FTX filed a lawsuit aiming to recover $244 million that the stock-clearing platform, Embed's CEO gained over an allegedly overpriced acquisition.
