The post FTX and Alameda Will Pay $12.7 Billion to Creditors appeared on BitcoinEthereumNews.com.

New York Judge Peter Castel of the US District Court ordered the defunct crypto exchange FTX and sister firm, market maker Alameda Research, to reimburse defrauded creditors by $12.7 billion. The suit was brought by the Commodities and Futures Trading Commission (CFTC) on December 21, 2022, and finally concluded on August 8, providing respite to those who lost their funds during the FTX collapse. The court found that “the FTX Entity Defendants commingled assets and freely used assets deposited by FTX customers as if they were Alameda’s assets, including as capital to deploy in Alameda’s own trading and investment activities.” The findings further detailed how Sam Bankman Fried, FTX’s disgraced founder, utilized customer funds to fund his lifestyle and other activities, including marketing the exchange by paying millions for Superbowl advertisements. Regarding the restitution, the court is demanding that “FTX Trading and Alameda shall pay, jointly and severally, restitution of Eight Billion Seven Hundred Million Dollars ($8,700,000,000) (“Restitution Obligation”) to persons who sustained losses proximately by the violations of the Act and Regulations described in the Amended Complaint and this Consent Order.” Furthermore, “FTX Trading and Alameda shall pay, jointly and severally, disgorgement of Four Billion Dollars ($4,000,000,000) (“Disgorgement Obligation”) for gains received in connection with the violations described in the Amended Complaint and this Consent Order.” These repayments add up to $12.7 billion. FTX had already agreed to the terms brought by the CFTC in July. However, approval from a judge was pending until now. This suit did not bring any civil penalties, meaning FTX and Alameda will repay creditors directly rather than paying fines to the regulator. Beyond addressing the disgorgements, the court permanently banned FTX and Alameda from defrauding commodities traders, trading digital assets, and buying and selling these assets for third-party customers. Source: https://www.livebitcoinnews.com/ftx-and-alameda-will-pay-12-7-billion-to-creditors/

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Filed under: News - @ August 10, 2024 3:26 pm