FTX’s current management has sued Daniel Friedberg, the company’s former compliance officer. June 27.

Friedberg suspected of misconduct

The filing broadly alleges that Mr. Friedberg violated his fiduciary duties and engaged in unlawful conduct. Mr. Friedberg previously served as Chief Compliance Officer for FTX, General Counsel for Alameda Research, and other internal and external positions.

Critically, FTX alleges Friedberg caused a waste of company assets and aided the misappropriation of funds by former FTX CEO Sam Bankman-Fried and other executives. bottom.

FTX specifically said Friedberg set up an organization called North Dimension to mix and misappropriate funds. They also allege that when the planned IPO required an audit, Friedberg created a “fake” company-to-company agreement to hide the move.

In addition, Friedberg was accused of “whitewashing” or covering up whistleblower complaints about the misuse and contamination of the company’s funds. Friedberg is said to have fired one whistleblower and paid them off with severance pay.

In addition, Friedberg helped execute billions of dollars in transfers to FTX executives, disguising those transfers as corporate loans. In fact, according to the application, the supposed loan had not been repaid and could not be repaid.

In one section, FTX claimed that the early company was “insolvent at all relevant points” and that it had been “a house of cards” since its inception. FTX alleges Friedberg supported a plan to deceive and sabotage customers.

FTX seeks fines and damages

Under its current administration, FTX is currently seeking various fines, damages and disgracement against Friedberg. He also demanded that certain properties be returned with interest. The amount involved will be determined at a future trial.

FTX filed this complaint in the Delaware Federal Bankruptcy Court as part of the company’s ongoing bankruptcy proceedings.

Other recent reports suggest that FTX is looking to resume operations under its current leadership. The company owes users $8.7 billion, much of which has been recovered despite being lost or embezzled in the past.

An article in which FTX sued former compliance officer Daniel Friedberg first appeared on CryptoSlate.

By Jules

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