Sam Bankman-Fried's FTX Fallout Continues: Former Advisor To Collapsed Crypto Firm To Pay $54 Million Settlement

Law firm Fenwick & West agreed on Friday to pay $54 million to settle allegations related to its advisory role in the collapse of the FTX cryptocurrency exchange.

Details Of The Settlement

The preliminary settlement was filed in the U.S. District Court for the Southern District of Florida and is pending the judge’s approval.

The parties agreed to resolve all pending and potential claims to “avoid the costs, inconvenience, and uncertainty of further litigation, the court filing states.

Fenwick provided legal services, advice, and consulting to FTX before the exchange’s collapse in 2022, which triggered a liquidity crisis and a prolonged cryptocurrency bear market.

Lawsuits were later filed against the California-based firm, alleging that it aided and abetted the fraud.

Fenwick denies the allegations and entered the settlement agreement “without admitting any wrongdoing, fault, liability, or damages,” according to the filing.

The FTX Saga

This settlement follows a dismissed plea for a new trial by Sam Bankman-Fried, the jailed cryptocurrency mogul behind FTX. The Judge labeled the new evidence brought by him as "wildly conspiratorial."

Bankman-Fried, popularly known as SBF, who is currently serving a 25-year sentence for the FTX scam, filed a request for a new trial in February, alleging that the Justice Department under Joe Biden threatened key defense witnesses from testifying. 

Judges and prosecutors found that SBF siphoned more than $8 billion in customer assets. He was convicted of misappropriating funds from the exchange customers and using the money for personal expenses, political contributions, and venture capital investments.

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