FTX “Yield Bearing Accounts” (YBAs) Lawsuit Lawyers FTX “Yield Bearing Accounts” (YBAs) Lawsuits are being filed against former FTX CEO Sam Bankman-Fried, FTX Trading Ltd., West Realm Shires Services Inc. d/b/a FTX US, and paid celebrity promoters and businesses. If you lost money or cryptocurrency due to the FTX scandal, you could file a claim to […]
FTX Yield Bearing Accounts Lawsuits
FTX “Yield Bearing Accounts” (YBAs) Lawsuits are being filed against former FTX CEO Sam Bankman-Fried, FTX Trading Ltd., West Realm Shires Services Inc. d/b/a FTX US, and paid celebrity promoters and businesses. If you lost money or cryptocurrency due to the FTX scandal, you could file a claim to recover your funds and monetary compensation for your losses. To see if you are qualified, contact Parker Waichman LLP to receive a free legal consultation. There are deadlines to file your claim, so contact Parker Waichman LLP at 1-800-YOUR-LAWYER (1-800-968-7529) as soon as possible to protect your rights.
FTX offered Yield Bearing Accounts that guaranteed an 8% annual percentage yield (APY) for total collective deposits of fiat currency or cryptocurrency (“crypto”) under $10,000 and a 5% APY for total collective deposits between $10,000 and $100,000. According to recently filed complaints, FTX failed to disclose the risks and how its Yield Bearing Accounts generated the applicable yield. Plaintiffs also allege that FTX stated that its Yield Bearing Accounts deposits would be “staked,” which is commonly understood within the crypto community as a process by which a crypto holder commits their cryptocurrency/assets to secure the function of a blockchain in exchange for financial compensation. According to the FTX Yield Bearing Account lawsuits, FTX did not stake their customers’ YBA investments and instead leveraged and loaned their customers’ assets to third parties. FTX’s terms of service stated that “none of the digital assets in your account are the property of, or shall or may be loaned to, FTX Trading,” but as alleged in the FTX Yield Bearing Account lawsuits, that representation could not have been farther from the truth.
Plaintiffs also allege that FTX, related entities, and celebrity promoters of the FTX platform, including Tom Brady, Giselle Bündchen, Stephen Curry, Larry David, Udonis Haslem, Trevor Lawrence, Kevin O’Leary, Shaquille O’Neal, Shohei Ohtani, David Ortiz, Naomi Osaka, ’ the Golden State Warriors organization, and others, deceptively marketed FTX’s platform, including its YBAs, as a safe and guaranteed place to invest. However, FTX’s YBAs were unregistered securities, and therefore the victims who lost money or cryptocurrency due to the FTX Scandal are entitled to the return of their investments and/or actual and punitive damages. The aforementioned Defendants are being sued in U.S. District Court in Miami, Florida.
Regarding the firm’s massive promotional efforts, disgraced FTX CEO Sam Bankman-Fried had said, “e need to meet people where they are—and that means embracing skepticism.” To that end, Bankman-Fried enlisted the help of A-list athletes and celebrities to endorse FTX to potential investors, and even gave some of these promoters equity in his company. Among them included “greatest of all time” quarterback Tom Brady, who appeared in three televised advertisements, at times alongside his ex-wife and supermodel, Gisele Bundchen, calling their contacts to convince them to trade on FTX. Others, like Shark Tank star and television personality Kevin O’Leary, touted the safety of FTX through conferences and social media platforms. Carried by the voices of trusted icons and brands, Bankman-Fried lured victims into what is now known to have been one of the largest Ponzi schemes of all time. As a result, Brady, Bundchen, O’Leary, and many other celebrities, are being sued for their involvement as paid promoters of FTX, with further lawsuits expected to be filed in the coming months.
Victims of the FTX Yield Bearing Account fraud claim that they invested in FTX’s Yield Bearing Accounts in hopes of earning promised APY. It is estimated that victims lost as much as $11 billion. The FTX lawsuits allege that the celebrity spokespersons never revealed the scope, nature, and amount of the monetary compensation they each received in exchange for promoting the dishonest FTX platform. The U.S. Securities and Exchange Commission affirmed that a failure to disclose that information violates the anti-touting provision of the federal securities laws under Section 17(b) of the Securities Act of 1933. According to Section 17(b) of the Securities Act of 1933, it is illegal for an individual to tout a stock (security) without divulging the nature and substance of any consideration received from an underwriter, issuer, or dealer.
Ftx lawsuits
Recently, the Eleventh Circuit issued a ruling that supports claims against the promoters of unregistered securities in Wildes v. BitConnect Int’l PLC, 25 F.4th 1341, 1347 (11th Cir. 2022). The Wildes case concerned a different crypto Ponzi scheme involving a crypto platform called Bitconnect, which permitted users to loan cryptocurrency to other users. Like FTX, Bitconnect was promoted by several influential individuals, including a nationwide promoter named Glen Arcaro, who with his team, posted thousands of videos on social media to promote the platform. Plaintiffs asserted claims against Arcaro individually for violation of the prohibition on sale of unregistered securities under Section 12 of the Securities Act, which holds that a solicitor of unregistered securities is liable to the purchasers.
The Eleventh Circuit held that the claims against Arcaro were valid despite the fact that the means of mass communication used by him to promote the unregistered securities were not particularized to the defrauded consumers – the Court held that a solicitor of securities is liable to any person who purchases the security “whether that solicitation was made to one person or to a million unknown ones.”
In another recent decision holding promoters of unregistered securities liable to investors, Pino v. Cardone Cap., LLC, No. 21-55564, 2022 WL 17826876 (9th Cir. December 21, 2022), the Ninth Circuit held, citing Wildes, that videos posted on YouTube and similar websites can constitute solicitation under Section 12, even if the offering’s promoters did not directly target the particular purchasers. The Ninth Circuit further acknowledged that “the Act contains broad language authorizing the purchaser of a security to bring suit against ‘ny person…who offers or sells a security…by means of a prospect or oral communication’ that misleads or omits material facts. 15 U.S.C. s. 77(a)(2).
The Pino court held that a “prospectus” could be said to include “any prospectus, notice, circular, advertisement, letter, or communication, written or by radio or television, which offers any security for sale or confirms the sale of any security,” and, citing Wildes, again, held that “lthough the Securities Act of 1933 predates the Internet, the inclusion of radio and television communications indicates Congress contemplated that broadly disseminated, mass communications with potentially large audiences would fall within the Act’s scope.” Further, the court held that “offer to sell” includes “every attempt to offer to dispose of, or solicitation of an offer to buy, a security or interest in a security, for value. .”
Among other relief, attorneys for the Plaintiffs are seeking a declaration from the courts that FTX’s holdings of digital assets belong to their clients. The FTX lawsuits seek to lay claim to the diminishing financial assets of FTX and hold accountable all parties that aided and abetted or conspired with FTX. According to legal documents filed with the U.S. Bankruptcy Court in Delaware, FTX has promised to repay customer account holders first. However, there are several high-power financial businesses trying to recover the remaining FTX assets ahead of FTX’s customers.
FTX stopped customer account holders from making withdrawals and immediately filed for bankruptcy protection when its customers began withdrawing their holdings after questions arose about FTX’s finances. Federal prosecutors allege that FTX’s CEO Sam Bankman-Fried used customer funds to prop up his own crypto trading firm, Alameda Research. Bankman-Fried confessed that he committed risk-management mistakes at FTX, but pleaded not guilty to any criminal offenses. He was released on a $250 million bond – one of the largest bail packages in US history – and will remain under house arrest with an ankle monitor at his parents’ home in Palo Alto, California. To date, the identities of the two individuals who helped Bankman-Fried secure this unprecedented pretrial bond remain unknown.
If you or a loved one lost your investment in an FTX Yield Bearing Account, call Parker Waichman LLP at 1-800-YOUR-LAWYER (1-800-968-7529) to receive a free consultation and to protect your rights. The time to file is limited by law, so please do not delay speaking to one of our legal professionals about your situation.
A proposed class-action lawsuit against FTX seeks to assert claims on behalf of over one million FTX investors to compel a court order holding that traceable customer assets are no longer the property of FTX, and any Alameda Research property that is traceable to customers should also no longer be deemed Alameda property. If the court determines that these holdings are FTX property, then the Plaintiffs will seek a court ruling that they receive repayment before any other creditors.
Were you exposed to any of the following representations made by FTX and/or its celebrity promoters concerning the FTX platform and/or “Yield Bearing Accounts” (YBAs)?
Did you open an FTX Yield Bearing Account through the FTX exchange?
Did you fund the FTX Yield Bearing Account with a sufficient amount of fiat or cryptocurrency to earn interest for your holdings?
Are you now seeking restitution or compensatory damages?
If you answered “Yes,” to all four aforementioned questions, you may be qualified to file your claim. Contact Parker Waichman LLP as soon as possible because the time you have to file your claim is limited by law. Call Parker Waichman LLP today at 1-800-YOUR-LAWYER (1-800-968-7529) to protect your rights.
In accordance with the Florida Investor Protection Act, a non-registered, non-exempt security buyer is entitled to receive their money back if the buyer still holds the security while they seek a remedy. Should the investor sell the security in question prior to pursuing a remedy, damages are awarded to the purchaser in the price difference between the amount they invested and the sale price, plus interest.
Florida’s Deceptive and Unfair Trade Practices Act allows a Plaintiff to recover actual damages.
Florida’s Punitive Damages Statute (Florida Statute § 768.72) states that a defendant could be held financially liable for punitive damages if clear and convincing evidence shows the Defendant was personally culpable of committing gross negligence or egregious intentional misconduct.
Intentional misconduct is defined as a person who understands the wrongfulness of a specific bad behavior and its high probability of injuring or damaging another, yet intentionally commits that action, causing injury or damage to the other person.
Gross negligence is defined as a person’s conduct is so reckless that it forms a conscious disregard for the safety, life, or legal rights of individuals exposed to said conduct.
Investors in FTX Yield Bearing Accounts who have suffered financial losses have the option to file a separate lawsuit on behalf of their damages, or they can join a class action lawsuit. Generally speaking, Plaintiffs will join a class action lawsuit to reduce the litigation costs. However, class action lawsuits generally yield less financial compensation to the victim. Every FTX claim is different and speaking to an attorney at Parker Waichman LLP can help you determine which type of lawsuit is your best option.
If you do not wish to be part of a class action lawsuit, you may be able to opt out of the class before the class has been certified. These legal procedures and time deadlines are under the discretion of the court and may change at any time. Therefore, FTX fraud victims should contact Parker Waichman LLP today at 1-800-YOUR-LAWYER (1-800-968-7529) to determine the best legal option for their claim.
Parker Waichman LLP is one of a handful of national law firms that have recovered more than $2 billion in jury verdicts and lawsuit settlements for its clients. Parker Waichman LLP trial attorneys are recognized by judges, colleagues, defense attorneys, and, most importantly, former clients. Parker Waichman LLP has obtained hundreds of positive reviews. Our law firm has also accumulated a near-perfect rating on AVVO.com, and has received Martindale-Hubbell’s highest peer-review rating.
If you, or a member of your family suffered financial losses due to the FTX Yield Bearing Account (YBA) scandal, call our law firm to see if you or your loved one is qualified to file your claim. For your free consultation with one of our FTX Yield Bearing Account Loss Attorneys, simply call 1-800-YOUR-LAWYER (1-800-968-7529) today or simply fill out our online contact form to receive your free case review. The time you have to file your claim is limited by law. So, take action as soon as possible.
At Parker Waichman LLP, you will not pay any upfront money for our legal services. We represent clients on a contingency-fee-basis, which means our firm is only paid a legal fee from a settlement or jury award when you win. That is how confident we are in obtaining results for our clients. . For your free consultation with one of our FTX Yield Bearing Account Loss Attorneys, simply call 1-800-YOUR-LAWYER (1-800-968-7529).
