The bankrupt crypto exchange, FTX wants to get back $157.3 million that they say was taken dishonestly just before they had to declare bankruptcy.
On September 21, the defunct crypto exchange FTX filed a lawsuit against former employees of the Hong Kong-incorporated company called Salameda. This company used to be associated with the FTX group, as per court records.
In a legal document, it’s mentioned that individuals named Michael Burgess, Matthew Burgess, their mother Lesley Burgess, along with Kevin Nguyen and Darren Wong, and two other companies, supposedly had ownership of accounts on FTX.com and FTX US.
They allegedly took out money during the time leading up to FTX declaring bankruptcy.
The court filing stated, “Each of these transfers to Defendant Michael Burgess was made with the intent to hinder, delay or defraud FTX US’s present or future creditors.”
This information points out that these transactions were finalized shortly before FTX stopped allowing users to withdraw their cryptocurrency assets other than regular currency on November 8, 2022.
It suggests that Mathew Burgess, through messages on the workplace messaging app Slack, exerted pressure on FTX employees to prioritize and process specific withdrawal requests from an FTX US exchange account associated with Michael Burgess. This was done while misrepresenting that this account belonged to Mathew himself.
Former FTX CEO Sam Bankman-Fried (SBF) is currently in jail, awaiting his two-part trial. The first part is scheduled to start on October 3, 2023, with the second part set for March 2024.
On September 21, the judges decided not to release SBF from jail early. He had argued that being in jail made it difficult for him to prepare for his trial and believed it violated his First Amendment rights, which protect freedom of speech & expression under the United States Constitution.
On the same day, Judge Lewis Kaplan approved a request from the Department of Justice that blocks SBF’s important witnesses from testifying during his trial.
