(ThePennyWatcher.com) – Not too long ago now Sam Bankman-Fried was convicted on all charges related to his extensive FTX fraud, involving multiple entities. It was a complete disaster, and many lost millions.
So it comes as no surprise that the “mini Madoff” is now scheduled to be sentenced in March 2024. He has been found guilty of all seven criminal counts, including wire fraud, conspiracy to commit wire fraud, and money laundering.
As a result, he could potentially face a prison sentence of over a hundred years. He has been in jail ever since he was obtained.
During the height of the crypto boom, many people had options to invest their money/crypto in other platforms that offered to pay monthly interest on their assets, and one of these companies was BlockFi.
BlockFi was caught up in the FTX fraud when FTX’s trading firm, Alameda Research, defaulted on a $680 million loan from BlockFi which forced BlockFi to pause customer withdrawals and eventually file for bankruptcy in November 2022.
This house of cards that eventually came crashing down was because so many of these crypto companies were involved in some sort of business relationship where their assets were loaned or even co-mingled at one time.
And when FTX started to get into trouble, Blockfi started to feel the ramifications.
BlockFi alleges that it was the victim of fraud by FTX and Alameda Research, and they claim that they were swindled into a “scheme to defraud BlockFi and its customers” by misrepresenting their financial condition and using BlockFi’s customer funds for their own purposes.
Here is what BlockFi has specifically accused FTX and Alameda Research of:
- Misrepresenting the value of FTT tokens, a cryptocurrency that FTX created and promoted.
- Using BlockFi’s customer funds to prop up the price of FTT tokens.
- Engaging in market manipulation.
Unlike some other crypto platforms that were caught up with FTX, BlockFi is aggressively seeking to recover its losses for its customer reimbursement, and has recently officially closed their bankruptcy proceedings.
BlockFi is now in the midst of rolling out a schedule of re-payments for it’s customers, and while not everyone can expect to get back their full balance invested, it will be a large portion according to BlockFi.
Some people have lost everything, so BlockFi customers can be thankful that at least they are focused on reimbursing their customer base.
If you are a former Blockfi customer, pay attention to your inbox for email updates as this is their main communication vehicle.
Also, there are a variety of “phishing scams” that are active right now, so before you click anything within in an email, make sure you check the email from address and make sure it is only from its agency Kroll, and not some obscure random email.
The email may look “real” but the from email address always gives it away, so pay attention.
Best of luck!
