Bankrupt crypto exchange FTX has initiated a significant lawsuit against former employees of its Hong Kong affiliate, Salameda. The company’s claim is based on allegations that those former employees improperly transferred assets before bankruptcy proceedings.
According to the lawsuit, it is stated the former employees took advantage of withdrawal privileges through privileged transfers within the 90 days preceding the bankruptcy application, known as the “Preference Period”.The total value of the transactions during this period amounts to approximately $157.3 million. Interestingly, a significant portion of this amount was withdrawn from November 7 onwards. It is also claimed that $73 million of this amount was fraudulently transferred to Michael Burgess.
Names like Michael Burgess and Matthew Burgess Stand Out
Michael Burgess, Matthew Burgess, and some other employees mentioned in the lawsuit are among those accused of fraudulent money transfers.
Among the allegations, it is claimed that the defendants leveraged their connections with FTX personnel to gain priority over other customers during the asset withdrawal process. Furthermore, in messages shared on the communication app Slack, it was revealed that Matthew Burgess requested other FTX employees to “revoke” some pending withdrawal requests from Michael Burgess’s FTX US exchange account.
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