Until its collapse, FTX had been one of the world’s largest cryptocurrency exchanges — and one of the most aggressive at marketing digital currencies to the masses. The company had partnerships with NBA teams, patches on Major League Baseball umpire uniforms and the naming rights to the Miami Heat arena. It ran splashy TV ads during NBA and NFL games, including last year’s Super Bowl, in which celebrities portrayed FTX as an exciting but safe place to invest money, the Washington Post reported. On Tuesday, the U.S. government brought both criminal charges and civil actions against Samuel Bankman-Fried, the 30-year-old founder of FTX, accusing him of orchestrating one of the biggest financial frauds in U.S. history. But the odds of restitution for FTX customers are slim. “We’re not going to be able to recover all the losses here,” FTX’s new chief executive John J. Ray III told the House Financial Services Committee on Tuesday. So plaintiffs are trying a different approach. Working with Coral Gables, Fla., lawyer Adam Moskowitz, their lawsuit seeks to shift the focus from FTX executives to what Moskowitz sees as a larger circle of complicity that includes some of the world’s most celebrated actors and athletes. Moskowitz argues that FTX’s interest-bearing accounts were a security, which would require NFL quarterback Tom Brady and other promoters to reveal the details of their payments from FTX. The complaint claims “they have never disclosed the nature, scope, and amount of compensation they personally received in exchange for the promotion.” Instead, they appeared in ads featuring such moments as an enthusiastic Brady dialing up everyone in his contact list to pitch crypto trading on FTX, asking again and again: “You in?”
