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Caroline Ellison to forfeit assets in FTX settlement

Caroline Ellison to forfeit assets in FTX settlement

GrafaGrafa2024/10/09 08:00
By:Liezl Gambe

Caroline Ellison, former CEO of Alameda Research, has agreed to a settlement with FTX (CRYPTO:FTT), requiring her to turn over nearly all of her remaining assets. 

The motion, filed on October 7, requests court approval for Ellison to transfer her assets, excluding those already forfeited to the government or used for legal fees, to FTX creditors.

According to the motion, Ellison will have no remaining assets beyond certain personal belongings once the terms are fulfilled. 

The exact value of the assets she will relinquish has not been specified. 

In addition to surrendering her assets, Ellison has agreed to cooperate with ongoing investigations and lawsuits related to the FTX bankruptcy. 

Her involvement may include sharing information from her time as head of Alameda Research and her relationship with FTX founder Sam Bankman-Fried.

FTX claims the settlement is in the best interest of creditors, as it ensures they receive most of what they could potentially recover through continued litigation. 

Pursuing further legal action, FTX argues, would likely exhaust Ellison's remaining resources and result in higher legal costs for the bankrupt exchange.

The settlement follows FTX's July 2023 lawsuit against Ellison, Bankman-Fried, and other former executives, accusing them of breaching fiduciary duties and engaging in fraudulent transactions. 

FTX sought to recover $22.5 million in bonus payments from February 2022 and $6.3 million from 2021, as well as call options and equity that had been transferred to Ellison.

A hearing on the proposed settlement is scheduled for November 20. 

Ellison had previously cooperated with federal prosecutors in the case against Bankman-Fried, resulting in a reduced sentence of two years in September 2024. 

FTX's bankruptcy plan, approved on October 7, aims to recover between 118% and 142% of customer claims.

At the time of writing, the FTX Token price was $2.30.

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Disclaimer: The content of this article solely reflects the author's opinion and does not represent the platform in any capacity. This article is not intended to serve as a reference for making investment decisions.

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