FTX sues Dan Friedberg alleging he used ‘hush money’ to silence whistleblowers

The lawsuit claims Daniel Friedberg made a series of payments to whistleblowers to stop them from exposing the “true fraudulent nature” of the exchange.

FTX has filed a lawsuit against a former regulatory and compliance executive at the exchange, alleging he made a series of payments in attempts to prevent staff from blowing the whistle about issues at the exchange. 

On June 27, FTX filed a lawsuit against Daniel Friedberg who held multiple roles including chief regulatory officer at FTX, chief compliance officer of FTX US and general counsel at Alameda Research.

In the complaint, FTX claims Friedberg was a “fixer” for the exchange’s co-founder Sam Bankman-Fried who made “hush money” payments to two potential whistleblowers to stop them from leaking information about “regulatory issues” and the alleged close ties between FTX and Alameda Research.

In the 40-page filing, FTX unleashed 11 civil charges that, among other claims, alleged Friedberg breached his legal duties and approved a series of fraudulent transfers and “loans” to other former FTX execs.

During his 22-month stint at the exchange, Friedberg was also purportedly given a $300,000 salary, a signing bonus of $1.4 million, and 8% equity in FTX US — all of which FTX is seeking to claw back, according to the complai

Some parts of the complaint, especially those pertaining to the amounts the whistleblowers were paid, are redacted.

This is a developing story, and further information will be added as it becomes available.