The defunct cryptocurrency exchange FTX filed a lawsuit on September 21 against former employees of the Hong Kong-incorporated company Salameda, which was previously affiliated with the FTX group. according to court documents.
The court filing says FTX is seeking to recover $157.3 million it claims was fraudulently withdrawn in the hours before the exchange filed for bankruptcy.
According to the filing, Michael Burgess, Matthew Burgess and his mother, Lesley Burgess, as well as Kevin Nguyen and Darren Wong, along with two other companies, allegedly owned companies with registered accounts on FTX.com and FTX US and withdrew funds. in the โpreferential periodโ prior to FTX's bankruptcy filing.
The court file says:
"Each of these transfers to defendant Michael Burgess was made with the intent to hinder, delay, or defraud FTX US's present or future creditors."
It also highlights that these transfers were completed hours before FTX. stopped all withdrawals from non-fiat users on November 8, 2022.
It alleges that Mathew Burgess pressured FTX employees to "expel" certain pending withdrawal requests "from one of Michael Burgess' US FTX exchange accounts, while misrepresenting the account as his own," citing messages on Slack as evidence.
Related: Binance and CEO Changpeng Zhao ask court to dismiss SEC lawsuit
This development comes as former FTX CEO Sam Bankman-Fried (SBF) is in jail awaiting the first of his two-part trial, set to begin on October 3, 2023. The second trial is scheduled for March 2024.
On September 21, The judges decided against granting SBF early release from prison. He argued that he could not adequately prepare for trial from jail and said it violated his First Amendment rights to the United States Constitution.
On the same day, Judge Lewis Kaplan granted a motion proposed by the Department of Justice that prohibits the testimony of key SBF witnesses.
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