• FTX has filed a complaint in Wilmington, Delaware bankruptcy court seeking to recover $700 million from former Clinton aide Michael Kives and his investment firm, K5 Global.
• The company claims that Bankman-Fried transferred funds to Kives, Baum, and K5 Global after attending a social event hosted by Kives in 2022.
• It also alleges that Bankman-Fried used $214 million of FTX funds for an ill-advised investment in Kendall Jenner’s 818 Tequila brand.
FTX Seeks to Recover $700 Million
Now-defunct cryptocurrency exchange FTX has sued a former aide of Hilary Clinton and the former aide’s investment firm, K5 Global, to retrieve $700 million in funds. On Thursday, the company filed a complaint in Wilmington, Delaware bankruptcy court asking back the $700 million its founder Sam Bankman-Fried transferred to K5 entities in 2022.
Defendants Accused of Aiding & Abetting SBF
The lawsuit names K5 Global, Mount Olympus Capital, and SGN Albany Capital as well as affiliated entities and K5 Global co-owners Michael Kives and Bryan Baum as defendants. It claims that Bankman-Fried was a “profligate patron” who sent millions to Kives, K5 Global, and Baum after he attended a social event hosted by Kives in 2022. Defendants are further accused of aiding and abetting SBF through dishonest assistance and unjust enrichment.
Shell Company Used Funds for Investment
According to the complaint, a shell company controlled by Sam Bankman-Fried used $214 million of FTX funds for an ill-advised investment involving purchasing a minority stake in Kendall Jenner’s 818 Tequila brand. The tequila company’s assets were valued at just $2.94 million based on its filings with the US Securities and Exchange Commission.
FTX Moves To Claw Back Funds
FTX has sought the return of funds transferred from Alameda Research that ended up in SGN Albany Capital and funds transferred from Kives, Baum, and SGN Albany Capital to Mount Olympus Capital describing these transfers as being carried out “without receiving equivalent value” which can be reversed under the Bankruptcy Code or other laws.
In conclusion FTX seeks to reclaim over $800 million from multiple parties it accuses of aiding fraudulent transfer activities involving crypto trading firm Alameda Research related to Sam Bankman Fried’s investments into Kendall Jenner’s 818 Tequila brand using shell companies SGN Albany Capital && Mount Olympus Capital