The latest lawsuit dragged all those YouTube online social media crypto influencers on the radar, who promoted FTX exchange.
FTX was a popular crypto exchange but FTX co-founder Sam Bankman-Fried (SBF) misused the FTX customers’ funds for personal benefits. In the first week of Nov 2022, the FTX exchange collapsed badly, and finally, on 19 Nov 2022 FTX filed for bankruptcy with more than 130 affiliated companies. At present time, SBF is facing more than 14 fraud charges in the US and also former FTX executives are supporting investigators to solve the case and find the main culprit behind the FTX fraud.
On 15 March 2023, A class action lawsuit was filed by Edwin Garrison in the Southern District of Florida, Miami Division.
Plaintiff Garrison alleged that all the crypto Influencers promoted FTX as the best crypto asset trade platform, which was a fraud.
Plaintiffs named YouTubers Kevin “Meet Kevin” Paffrath, Graham Stephan, Andrei Jikh, Brian Jung, Jeremy “Financial Education” Lefebvre, Tom Nash, Ben “BitBoy Crypto” Armstrong, and Erika Kullberg in the lawsuit. In the list of defendants, there is NFL star Tom Brady alongside former FTX CEO Sam Bankman-Fried.
Almost all of these crypto influencers are popular in the crypto sector and known to provide genuine information to the crypto community.
Through the lawsuit, plaintiff claimed these mentioned defendants grabbed huge money from the FTX exchange for promoting the FTX exchange as a genuine crypto platform but they never disclosed it to their followers.
“Though FTX paid Defendants handsomely to push its brand and encourage their followers to invest, Defendants did not disclose the nature and scope of their sponsorships and/or endorsement deals, payments, and compensation, nor conduct adequate (if any) due diligence,” the lawsuit reads.