Class action filed against San Diego-based Silvergate Capital over FTX, Alameda debacle

Silvergate FTX class action overview: 

• Who: A man who invested his savings through the cryptocurrency exchange FTX is suing Silvergate, which allegedly maintained FTX accounts.
• Why: The plaintiff alleges they are not able to access their money after FTX collapsed last month, and that Silvergate has aided and abetted FTX’s alleged fraud.
• Where: The Silvergate FTX class action was filed in a California federal court.

A man who invested his savings through the now-collapsed cryptocurrency exchange FTX is suing Silvergate, which allegedly maintained FTX accounts, saying the company aided and abetted FTX’s fraud.

Plaintiff Joewy Gonzalez filed the class action lawsuit against Silvergate Bank, Silvergate Capital Corporation, and Alan J. Lane Dec. 14 in a California federal court, alleging violations of 

According to the complaint, Gonzalez invested his savings in cryptocurrency and entrusted his investments to FTX, a cryptocurrency exchange founded by Samuel Bankman-Fried. 

FTX promised investors that they could store assets securely as they gained in value, cash them out, or trade them for other assets or financial products, Gonzalez says. 

However, after FTX’s collapse last month, Gonzalez says he and other FTX investors are unable to recover their investments and face “years of uncertainty and catastrophic losses.”

According to the complaint, defendant Silvergate, a publicly traded and federally regulated bank catering to cryptocurrency customers, maintained FTX accounts and accounts run by FTX-associated company Alameda Research LLC. 

“It directly aided and abetted FTX’s fraud and breaches of fiduciary duty via first-hand participation in the commingling of funds, improper transfers, and lending out of customer money,” Gonzalez alleges.

“Silvergate processed billions in transfers from FTX’s client account at Silvergate to the Alameda accounts.” 

Silvergate is obligated to repay customers, lawsuit alleges

Silvergate is liable for its role in furthering FTX’s investment fraud and breaches of fiduciary duty and is obligated under common law to make Gonzalez and the other investors whole, the lawsuit alleges.

Gonzalez is looking to represent anyone who, as of Nov. 11, 2022, had legal title to any fiat or cryptocurrency deposited or invested with FTX, including from the FTX.com, FTX US and FTX international platforms.

He’s suing for aiding and abetting fraud and aiding and abetting breach of fiduciary duty, as well as unjust enrichment. Gonzalez is seeking certification of the class action, damages, fees, costs and jury trial.

Earlier this week, the U.S. Securities and Exchange Commission (SEC) advised cryptocurrency companies that they may be obligated to disclose how recent collapses and financial distress in the crypto industry could disrupt the market.

The SEC’s advisory follows the recent collapse of FTX, which filed for Chapter 11 bankruptcy last month after customers began inundating the company with withdrawal requests. 

Did you have money invested through FTX? Let us know your experience in the comments! 

The plaintiff is represented by Daniel C. Girard, Adam E. Polk and Makenna Cox of Girard Sharp LLP and Jason S. Hartley and Jason M. Lindner of Hartley LLP.

The Silvergate class action lawsuit is Joewy Gonzalez et al., v. Silvergate Bank, et al., Case No. 3:22-cv-01981-BEN-WVG in the U.S. District Court for the Southern District of California. 

Read About More Class Action Lawsuits & Class Action Settlements:

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• Silvergate class action claims crypto bank responsible for some FTX losses
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• FTX founder, celebrity promoters face class action following bankruptcy