The last month has been difficult and challenging for customers of the cryptocurrency platform FTX. Clients withdrew billions of dollars worth of holdings after rival Binance tweeted that it will sell its holding of FTX’s FTT token.
Not long after the tweet, FTX filed for bankruptcy and its CEO Sam Bankman-Fried subsequently resigned. He resigned after reports that he co-mingled his funds from FTX clients with another one of his ventures. He has since been arrested and charged with several counts of conspiracy and fraud, according to Fortune.
With the collapse of FTX, many customers have been unable to withdraw their money from the platform. They have since filed a class action suit against the company. The suit was filed last month in Miami by Edwin Garrison. He is seeking class-action status on behalf of himself and FTX users against Bankman-Fried and FTX’s celebrity endorsers.
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The complaint describes FTX as a “Ponzi scheme,” and claims that its celebrity spokespeople had endorsed unregistered securities. One of the celebrities listed in the suit is NBA legend turned-businessman Shaquille O’Neal. He is accused of promoting the company in a June commercial. The suit alleges that FTX’s spokespeople “either controlled, promoted, assisted in [or] actively participated” in a plot to “aggressively market” the company, according to CNBC Make It.
In a pushback, Shaq is distancing himself from the company, saying he was merely a celebrity in an ad. “A lot of people think I’m involved, but I was just a paid spokesperson for a commercial,” O’Neal told CNBC Made It.
Last year, he told the platform that he was avoiding crypto. “I don’t understand it,” O’Neal said at the time. “So I will probably stay away from it until I get a full understanding of what it is.” The basketball star also declined promotional offers from various crypto entities. People were therefore surprised by his June commercial for FTX.
The class-action suit also named NBA player Steph Curry and football star Tom Brady as well as supermodel Gisele Bundchen. Shaq said he agreed to appear in the June ad because of his friendship with Curry. Curry is yet to respond.
