FTX, a bankrupt cryptocurrency exchange, has taken legal action against Michael Kives and his company, K5 Global, in an attempt to recover $700 million. Kives, a former aide to Hillary Clinton who now works as a Hollywood super agent, allegedly received the funds from Sam Bankman-Fried, a disgraced crypto mogul. Bankman-Fried authorized the transfer of the funds to K5 entities in a bid to secure rescue financing before FTX went bankrupt in November 2022. Kives, who has connections to celebrities like Warren Buffett and Katy Perry, faced significant losses due to K5 Global’s relationship with FTX’s defunct investment arm. Bankman-Fried described Kives as highly influential in political and celebrity circles. The lawsuit alleges that Bankman-Fried made investments in K5 projects that enriched Kives and his business partner, Bryan Baum, with no benefit to FTX or its customers who were left footing the bill. One example cited in the complaint is the use of $214 million in FTX funds to purchase a stake in Kendall Jenner’s spirits brand. At the time of the investment, the brand was valued at just $2.94 million. A spokesperson for K5 stated that the lawsuit is without merit and that they believed their business relationship with Bankman-Fried was legitimate. FTX, under new leadership after filing for bankruptcy, has recovered over $7 billion in assets to repay customers. The company has also filed lawsuits relating to pre-bankruptcy investments and payments. Additionally, FTX has reached a settlement with the Metropolitan Museum of Art to return $550 million in donations received from FTX companies in 2022.
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