Former basketball star Shaquille O’Neal has been served with a class-action lawsuit alleging that he violated securities laws by promoting the now-bankrupt cryptocurrency exchange FTX.
The lawsuit, which was filed in Florida federal court, alleges that O’Neal made false and misleading statements about FTX in a series of promotional videos and social media posts. The plaintiffs in the lawsuit claim that they lost money after investing in FTX based on O’Neal’s endorsements.
This is not the first time that O’Neal has been accused of making false and misleading statements about cryptocurrency.
In 2021, he was sued by the U.S. Securities and Exchange Commission for allegedly promoting the cryptocurrency Initial Coin Offering (ICO) of Centra Tech. O’Neal settled the lawsuit without admitting or denying any wrongdoing.
The lawsuit against O’Neal over his FTX promotion is the latest in a series of legal troubles for the cryptocurrency exchange.
In February, FTX filed for bankruptcy after being unable to pay its debts. The company’s founder, Sam Bankman-Fried, has also been accused of insider trading.
It remains to be seen whether O’Neal will be found liable in the lawsuit against him. However, the case is a reminder of the risks associated with promoting cryptocurrency.
Celebrities who endorse cryptocurrency should be aware that they could be held liable for any losses that investors suffer.