https://www.reuters.com/legal/ftx-founder-bankman-fried-sued-us-court-over-yield-bearing-crypto-accounts-2022-11-16/?utm_source=reddit.com

Nov 16 (Reuters) - U.S. crypto investors sued FTX founder Sam Bankman-Fried and several celebrities who promoted his exchange including NFL quarterback Tom Brady and comedian Larry David, claiming they engaged in deceptive practices to sell FTX yield-bearing digital currency accounts.

The proposed class action filed on Tuesday night in Miami alleges that FTX yield-bearing accounts were unregistered securities that were unlawfully sold in the United States.

FTX filed for bankruptcy and is facing scrutiny from U.S. authorities amid reports that $10 billion in customer assets were shifted from FTX to Bankman-Fried's trading company Alameda Research.

When the crypto exchange faltered on liquidity concerns, U.S. investors sustained $11 billion in damages, the lawsuit says.

The lawsuit seeks damages from Bankman-Fried and 11 athletes and other celebrities who promoted FTX, including David, the creator of "Seinfeld" and "Curb Your Enthusiasm."

David starred in a commercial for FTX that aired during the 2022 Super Bowl in which he portrayed fictional characters dismissing important innovations throughout history and ended with the message "Don't Miss Out on Crypto."

Brady, tennis star Naomi Osaka and professional basketball team the Golden State Warriors are also defendants in the lawsuit.

Representatives for Bankman-Fried, Brady, Osaka, David and the Golden State Warriors did not immediately respond to requests for comment on Wednesday.

John J. Ray III, FTX's new chief executive who is not named as a defendant in the lawsuit, declined to comment on the allegations.

The lawsuit was brought on behalf of Edwin Garrison, an Oklahoma resident who had an FTX yield-bearing account which he funded with crypto assets to earn interest, and others like him.