FTX sues for $240 million paid for stock trading platform [Advance Cash ]

Ftx Sues For $240 Million Paid For Stock Trading Platform

FTX would work to recoup the more than $240 million he paid for stock trading platform Embed.

The bankrupt cryptocurrency exchange filed three lawsuits on Wednesday, May 17, alleging that former FTX executives failed to do their due diligence before acquiring the platform and that the software was "essentially worthless", Reuters reported Thursday (May 18).

The three lawsuits target former FTX insiders, Embed executives and Embed shareholders, according to the report.

FTX had planned to use Embed software to add stock trading to its own platform. It closed the acquisition six weeks before filing for bankruptcy in November 2022, according to the report.

Recently, under its new management, FTX attempted to sell Embed and found that the highest bid - which came from Embed founder Michael Giles - was only $1 million, according to the report.

These lawsuits join one in which two of FTX's companies - Alameda Research and FTX US - are suing to recover $6.9 million from Embed, alleging that FTX founder Sam Bankman-Fried and members of his entourage paid for Embed using embezzle funds.

Bankruptcy law allows courts to reverse "fraudulent conveyances," transfers of a company's assets to prevent them from being reimbursed to creditors.

According to the court filing, plaintiffs' attorneys said Bankman-Fried and his associates made a series of transactions through Signature Bank to make it appear that the money used to acquire Embed came from their personal accounts and not from the bank. 'business.

In other recent FTX news, PYMNTS reported on May 12 that court documents reveal that the US Treasury Department and the Internal Revenue Service (IRS) alleged that FTX and its various bankrupt subsidiaries collectively owed approximately $44 billion. dollars to the government unpaid corporate taxes and social charges.

Four days earlier, on May 8, Bankman-Fried had filed court documents asking a federal judge to dismiss 10 of the 13 charges brought against him.

Lawyers for the FTX founder are seeking to dismiss multiple charges of wire fraud, conspiracy to commit bank fraud charges, and bribery and campaign finance charges.

Bankman-Fried has pleaded not guilty to all charges against him, remains free on bail and is due to stand trial in October.