FTX was ordered to pay $12.7 billion to consumers and victims, the CFTC said. The consent order will end litigation filed by the CFTC in 2022.
A court ordered bankrupt crypto exchange FTX and subsidiary Alameda Research to pay $12.7 billion to customers and victims of their fraud, the Commodity Futures Trading Commission said in a statement. News release.
US District Judge Peter Castel of the Southern District of New York approved a Consent Order The CFTC lawsuit, filed in December 2022, ended.
This amount includes $8.7 billion in restitution and $4 billion in disgorgement, which will be used to further compensate victims of the massive FTX fraud.
“FTX used outdated tactics to create the illusion that it was a safe and secure place to access the crypto markets,” said CFTC Chairman Rostin Behnam. “But basic control tools such as governance, customer protections and surveillance are not there to detect misconduct and ultimately prevent collapse.”
In a related settlement approved by the Bankruptcy Court for the District of Delaware, the CFTC agreed not to seek civil monetary penalties against FTX and to subordinate its monetary claims to victims of FTX's fraud scheme.
FTX ran on customer deposits in late 2022, revealing a fraud that took customer funds, commingled them with its own, and spent them for political influence. Celebrity endorsements and immovable property
A federal judge in the Southern District of New York sentenced FTX founder Sam Bankman-Fried to 25 years in prison in March, citing the “brazenness” of his fraud. News reported.
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