FTX Seeks to Recover $300M Paid to the Leadership of Its European Affiliate

<p>FTX bankruptcy lawyers have sought court orders to
recover $323 million paid to the leadership of FTX Europe, a subsidiary of the
now-bankrupt cryptocurrency exchange. The amount is believed to be part of a
larger sum of money allegedly misappropriated by the former FTX executives.</p><p>According to a court
filing yesterday (Wednesday) seen by CoinDesk, Sam Bankman-Fried, the former
FTX CEO and the FTX Group, allegedly paid the money for the acquisition of
DAAG, a Swiss company that was later renamed FTX Europe.</p><p>According to the
lawyers who submitted the matter on behalf of FTX and Maclaurin Investments, an entity owned by Alameda Research, FTX Europe had limited resources.</p><p>FTX Traces Customers' Assets</p><p>FTX is now seeking that
a Delaware-based bankruptcy court handling its <a href="https://www.financemagnates.com/terms/b/bankruptcy/">bankruptcy</a> proceedings order that the
funds paid to the individuals overseeing FTX Europe, Patrick Gruhn, Branson
Willaims, Robin Matzke, and Lorem Ipsum, be returned to the company.</p><p>On top of that, <a href="https://www.financemagnates.com/cryptocurrency/troubled-ftx-files-for-bankruptcy-as-ceo-bankman-fried-resigns/" target="_blank">FTX
bankruptcy</a> lawyers
informed the court that the leadership of FTX Europe received approximately
$100 million for the <a href="https://www.financemagnates.com/terms/a/acquisition/">acquisition</a> of K-DNA, a licensed entity in the European
Economic Area, which was later integrated with FTX Europe for €2 million.</p><p>The FTX Group has also
asked the court to stop the remaining payments of more than $50 million to the
FTX Europe's leadership. In the filing, the exchange’s lawyers claimed that FTX Europe
is not valuable and cannot be sold.</p><p>FTX Europe</p><p>In April, a court in
Switzerland granted FTX permission to explore the potential sale of FTX
Europe. The permission was granted following a petition filed by FTX
Europe to restructure its debt amid the bankruptcy filing by the parent
company, FTX.</p><p>Earlier in the year, <a href="https://www.financemagnates.com/cryptocurrency/ftx-eu-creates-new-website-for-customer-balance-withdrawal/" target="_blank">FTX
Europe announced</a> that
it had initiated processes to allow its users to withdraw funds. The subsidiary
had only been in operation for eight months before the collapse of its parent
company FTX.</p><p>FTX’s bankruptcy team
released a report in June that the cryptocurrency exchange had so far <a href="https://www.financemagnates.com/cryptocurrency/ftx-bankruptcy-team-releases-second-investigative-report-7b-recovered/" target="_blank">recovered
$7 billion</a> out of the
$8.7 million owed to customers. In the report, the team noted that the
extensive commingling of funds complicated the efforts to recover the remaining
assets, <a href="https://www.financemagnates.com/cryptocurrency/troubled-ftx-files-for-bankruptcy-as-ceo-bankman-fried-resigns/" target="_blank">Finance
Magnates</a> reported.</p><p>The
former exchange’s executives reportedly misappropriated customers' funds in
speculative trading, political donations, and investments in luxury real estate
in the Bahamas. Sam Bank-Man Fried is <a href="https://www.financemagnates.com/cryptocurrency/ftxs-sam-bankman-fried-battles-us-post-extradition-charges-in-bahamas/" target="_blank">facing
several federal charges</a> related
to fraud and conspiracy.</p>

This article was written by Jared Kirui at www.financemagnates.com.