FTX sues former Hong Kong subsidiary staff to recover $157.3 million

The current FTX leadership filed a suit against former employees of the Hong Kong subsidiary seeking the return of $157.3 million that were fraudulently withdrawn. This occurred on the eve ofthe start of bankruptcy proceedings.

The defendants were Michael Burgess, Matthew Burgess, Leslie Burgess, Kevin Nguyen, Darren Wong, and two entities affiliated with the platform.

According to the document, during the 90-day period prior to filing for bankruptcy protection under Chapter 11, the aforementioned individuals benefited from withdrawals from accounts at FTX and FTX.US.

The suit states that transactions totaling more than $123 million occurred on November 7 and thereafter, with the primary recipient being Michael Burgess.

In a March presentation, the exchange’s representatives estimated the aggregate shortfall to cover creditor claims at $8.7 billion, of which about $1.6 billion was in Bitcoin. In June 2023, the platform’s current management team said it had recovered liquid assets worth about $7 billion.

In May, FTX filed a suit against Genesis demanding return $3.9 billion. Subsequently, the amount of claims was reduced to $2 billion. The companies agreed to pay $175 million to Alameda Research.

In July, lawyersdemanded the return of $71 million from exchange-affiliated charitable units.

In September, the court approved Robinhood’s buyback of 55 million shares worth $605.7 million, which previously belonged to the platform’s founder Sam Bankman-Fried.

In the same month, FTX filed a suit against LayerZero demanding return $86 million.