FTX Trading and its affiliate Alameda Research have been ordered to pay $12.7 billion to compensate customers and fraud victims under a consent order, US regulators announced on Thursday.
FTX Trading, Alameda Research ordered to pay $12.7 billion, CFTC has said
8/8/2024
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A New York court issued the order following a large-scale fraud scheme orchestrated by former FTX CEO Sam Bankman-Fried. The Commodity Futures Trading Commission (CFTC) described the amount as its largest recovery ever.
According to the CFTC, FTX and Alameda "made material misrepresentations and omissions to customers" about the security of their funds, which were actually "misappropriated."
While this settlement concludes the CFTC's litigation against FTX, the agency continues to pursue restitution in separate cases involving Bankman-Fried and three other individual defendants.
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In March, a federal judge sentenced Bankman-Fried to 25 years in prison and $11 billion in forfeiture following a New York jury's guilty verdict after a prolonged trial.
Bankman-Fried rapidly expanded FTX into a major global cryptocurrency player before the company dramatically collapsed in November 2022.
FTX announced in May that it plans to return 100% of bankruptcy claim amounts plus interest, with anticipated payouts ranging from $14.5 billion to $16.3 billion.
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