Edwin Garrison is leading a group of investors who have launched a class action lawsuit against a group of YouTube “FTX influencers” for pushing the FTX crypto scam without revealing rewards totaling $1 billion. On March 15th, the case was submitted to the Miami Division of the Southern District of Florida.
Defendants Kevin Paffrath, Graham Stephan, Andrei Jikh, Jaspreet Singh, Brian Jung, Jeremy Lefebvre, Tom Nash, Ben Armstrong, Erika Kullberg, and Creators Agency LLC are eight YouTubers and the talent management organization that promoted FTX.
Crypto scam lawsuit report
The lawsuit says that the YouTubers were paid by FTX to promote the business and encourage their followers to invest, but they hid the fact that they were sponsored by the company. It also says that the plaintiffs were hurt because they invested in a YBA (yield-bearing account) from FTX, which the defendants had pushed for their own financial gain and/or FTX’s.
The Moskowitz Law Firm is representing the seven plaintiffs listed in the complaint. The plaintiffs hail from five different countries and all purchased unregistered securities from FTX. Plaintiffs in the litigation allege to speak for “thousands, if not millions, of consumers globally to whom FTX offered and/or sold YBAs” on a global and national scale.
The lawsuit also cites a 2017 warning from the United States Securities and Exchange Commission that anyone who promotes yield-bearing accounts may face prosecution for doing so in violation of federal securities laws. Recent and ongoing lawsuits between the SEC and the crypto industry, as well as the Howey and Reves tests, are cited in the action as evidence that the SEC has taken a “consistent approach to cryptocurrencies.”
This is the first class action lawsuit filed in the country about FTX, and it consolidates many previously filed class actions. On November 15, 2022, Garrison filed a lawsuit against FTX and its purported celebrity endorsers. The class action lawsuit also includes Garrison as a named plaintiff.
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