A group of YouTubers who promoted the now-collapsed cryptocurrency exchange FTX, headed by CEO and Democrat megadonor Sam Bankman-Fried, are facing a class-action lawsuit of over $1 billion in damages from victims who lost money following the scandal.
According to a report by Fortune, the class action lawsuit, filed on March 15, claims that the influencers were paid "handsomely" to promote FTX, which collapsed in November, leaving customers with losses estimated to be worth up to $8 billion.
The plaintiffs, who are from the U.S., Canada, the U.K., and Australia, are seeking more than $1 billion in damages from the social media influencers, as well as an influencer agency, alleging that the "defendants did not disclose the nature and scope of their sponsorships and/or endorsement deals, payments, and compensation, nor conduct adequate (if any) due diligence."
The lawsuit claims the influencers hyped FTX and thus played a "major role" regarding the scandal that followed the crypto exchange and says that without their support and "hype," the crypto platform would have never reached such heights. The suit goes on to allege that influencers took "undisclosed payments ranging from tens of thousands of dollars to multimillion-dollar bribes."
The defendants listed in the lawsuit include YouTubers Graham Stephan, Andrei Jikh, Jaspreet Singh of "Minority Mindset," Brian Jung, Jeremy Lefebvre, Tom Nash, Ben Armstrong, and Kevin Paffrath, as well as Creators Agency and its founder Erika Kullberg.
Some defendants denied the allegations, with Armstrong telling Decrypt that he plans to countersue "immediately.”
Armstrong wrote to Decrypt via direct message on Twitter that he had "never spoken with anyone at FTX or as a marketing agent acting on their behalf. Not once. So the allegations against me are 100% false and it will be extremely easy to provide evidence of this."
The lawyer for the plaintiffs, Adam Moskowitz, who filed similar lawsuits against FTX influencers such as NFL quarterback Tom Brady and Brady's ex-wife, supermodel Gisele Bündchen, as well as nine other celebrities, said in an interview with The Washington Post, "You have very rich people we all love telling us that they checked this out, and it was OK. Why shouldn't they be held responsible?
"It seemed like a lot of investors were getting hurt, and no one was really looking out for them," Moskowitz said.
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