A group of legal teams representing Alameda Research, FTX US, and FTX Trading have filed a complaint against FTX Digital Markets, a Bahamas-based company accused of being a “fraudulent enterprise” created to conceal the ownership of the firm.
The lawsuit alleges that FTX Digital Markets, or FTX DM, was a “legal nullity” and an “economic nullity” that was used as a “front to facilitate a conspiracy to defraud the Debtors’ customers.”
The complaint claims that FTX DM’s claims to ownership of FTX.com’s fiat and crypto assets and other intellectual property are “baseless” and that they will harm FTX.com’s customers and other creditors.
The debtors have sought a ruling to assert FTX DM’s ownership interest in the property at the center of the bankruptcy case.
The legal team also cited former FTX CEO Sam Bankman-Fried’s criminal and civil charges in the U.S., alleging that he had connections with Bahamian authorities to minimize his “criminal and civil exposure should the massive fraud be discovered.”
The FTX Group filed for bankruptcy in the U.S. on November 11th, 2022, one day after the Securities Commission of The Bahamas froze FTX DM’s assets and suspended the firm’s registration.