Silvergate Deals with Class-Action Lawsuit Over FTX and Alameda Activities
Filed at the California Southern District Court, a class-action lawsuit against Silvergate Bank, Silvergate Capital Corporation and Silvergate CEO, Alan Lane, regarding accounts held by bankrupt FTX and Alameda Research has surfaced.
The suit aims to hold Silvergate accountable for its roles in placing FTX user deposits into the bank accounts of Alameda, which eventually led to the market crash that caused immense panic among investors.
Plaintiff Joewy Gonzalez filed the suit on behalf of himself and others who are in the same deep hole. As a matter of fact, according to the suit, the plaintiff invested his savings in crypto through the FTX exchange as the platform promised investors that they were able to “store assets securely as they gained in value, cash them out or trade them for other assets.”
The suit explains that Silvergate helped FTX in committing fraud through improper transfers, which is why it has an obligation to return what it owes to the plaintiff and other investors.
According to Cointelegraph, on Dec. 6, three United States senators wrote a letter to Silvergate demanding answers on the firm’s role in the loss of billions of dollars during the FTX collapse. Senators Elizabeth Warren, John Kennedy and Roger Marshall asked Lane to provide details on the firm’s relationship with FTX.
In the meantime, lawyers representing FTX are seeking permission from a U.S. bankruptcy court to sell off the firm’s Japanese and European branches, derivatives exchange LedgerX and stock-clearing platform Embed.
