Silvergate Bank as defendants in a proposed class-action lawsuit from an FTX user
In a newly proposed class-action lawsuit, Silvergate Bank and its CEO Alan Lane have been accused of "aiding and abetting" a "multibillion-dollar fraudulent scheme orchestrated by Sam Bankman-Fried (SBF)" and two of Sam Bankman-entities, Fried's FTX and Alameda Research. This accusation comes in the context of a "multibillion-dollar fraudulent scheme orchestrated by Sam Bankman-Fried (SBF)."
On February 14, 2019, a proposed class-action lawsuit was submitted to the United States District Court for the Northern District of California by attorneys representing a San Francisco-based FTX user who had approximately $20,000 worth of cryptocurrency frozen after the exchange went out of business the previous year.
Plaintiff Soham Bhatia claims that Silvergate Bank, its parent company Silvergate Capital Corporation, and CEO Alan Lane were aware of the use of FTX customer funds by Alameda Research, and she has accused them of concealing "the true nature of FTX" from its customers. Bhatia is suing Silvergate Bank, Silvergate Capital Corporation, and CEO Alan Lane.
According to the lawsuit, "At all relevant times, Silvergate, Bankman-Fried, and Lane were each a co-conspirator of the other," with the following addition: "The lawsuit alleges Silvergate and Lane aided, abetted, encouraged, and substantially assisted Bankman-Fried in jointly perpetrating a fraudulent scheme upon Plaintiff and the class."
"By aiding, abetting, encouraging, and substantially assisting the wrongful acts, omissions, and other misconduct alleged above, Defendants acted with an awareness of their wrongdoing and realized that their conduct would substantially aid the accomplishment of their illegal design," the complaint states. "In addition, Defendants acted with the knowledge that their actions would substantially assist the accomplishment of their unlawful design."
The lawsuit asks for a variety of remedies, including damages, restitution, and a proportionate share of the defendant's earnings, with the precise amount being decided during the trial.
However, the complaint has not yet been certified as a class action by the district court, which is an essential step that must be completed before the case can go forward.
The most recent potential legal action against Silvergate is yet another class-action complaint that has been filed against the company during the last two months.
Plaintiff Joewy Gonzalez filed a similar class-action suit against Silvergate on December 14 in the United States District Court for the Southern District of California, accusing Silvergate of its alleged role in "furthering FTX's investment fraud" by aiding and abetting the cryptocurrency exchange when it placed FTX user deposits into the bank accounts of Alameda. Gonzalez's suit alleges that Silvergate played a role in "furthering FTX's investment fraud" by placing FT
A class action lawsuit against Silvergate Capital Corporation was submitted to the United States District Court for the Southern District of California on January 10, alleging that Silvergate's platform failed to detect instances of money laundering "in amounts exceeding $425 million" involving South American money launderers. The lawsuit was brought against Silvergate Capital Corporation.
There have been allegations leveled against other businesses that are similar in nature.
The algorithmic trading business Statistica Capital has filed a putative class-action lawsuit against the New York-based bank Signature Bank, saying that Signature Bank "really knew of and materially supported the now-infamous FTX scam." The case was filed on February 6 of this past week.
The report said in its writing that "in particular, Signature knew of and enabled the commingling of FTX client money inside its proprietary blockchain-based payments network, Signet."