FTX is seeking to claw back some $700 million from a former aide to Hillary Clinton-turned Hollywood super agent who was allegedly showered with cash by disgraced fallen crypto mogul Sam Bankman-Fried.
The bankrupt cryptocurrency exchange took legal action on Thursday against Michael Kives, who was an assistant to then-Sen. Hillary Clinton (D-N.Y.), and his company, K5 Global, and firm co-founder Bryan Baum.
According to court papers filed in bankruptcy court in Delaware, Bankman-Fried authorized the transfer of $700 million to K5 entities in 2022, and he leaned on K5’s celebrity and business connections in his effort to obtain rescue financing in the days before FTX went bankrupt in November 2022.
As The Post reported in December, Kives — whose celebrity connections include Warren Buffett, Arnold Schwarzenegger, Katy Perry, and Kendall Jenner — stood to lose hundreds of millions of dollars as a result of K5 Global’s business relationship with FTX’s now-defunct investment arm, Alameda Research.
Bankman-Fried, who has been indicted on fraud and money laundering charges by the feds, described Kives as “probably, the most connected person I’ve ever met,” and “a one-stop shop” for political relationships and celebrity partnerships, according to the complaint.
The fallen crypto mogul was known to cultivate ties with the wealthy and powerful, including Bill and Hillary Clinton.
Bankman-Fried has pleaded not guilty. A trial is set to begin this fall.
Bankman-Fried brushed off FTX employees’ concerns that K5 was “trying to nickel and dime” or “scam” FTX, continuing to make investments in a quest to burnish his own political and social influence, according to the complaint.
FTX, which is currently controlled by court-appointed receivership, alleged in court papers that Bankman-Fried authorized investments in K5 projects that enriched Kives and Baum with no payoff for FTX or its customers, who were footing the bill.
The complaint alleges that a shell company controlled by Bankman-Fried used $214 million in FTX funds to buy a minority stake in 818 Tequila, the spirits brand owned by Kendall Jenner.
At the time of the ill-fated investment, 818 Tequila was worth just $2.94 million, according to SEC filings cited in the lawsuit.
In a written statement to The Post, a K5 spokesperson said the venture capital firm has more than $1 billion in assets under management apart from any funds from SBF and his affiliates) and has investments in 148 companies.
“In mid-2022 an affiliate of Sam Bankman-Fried and Alameda bought a third of K5’s general partnership for cash and stock, and ultimately made a $400 million investment in certain funds managed by K5. K5 was under the impression – like many others – that SBF was completely legitimate and they were entering into a fair, long-term, and mutually beneficial business relationship,” the spokesperson said. “Our belief is that the lawsuit is without merit.”
The Post has sought comment from Bankman-Fried.
Since filing for bankruptcy, FTX’s new leadership has recovered more than $7 billion in assets that can be used to repay customers whose funds were frozen when the crypto exchange collapsed.
FTX has also filed lawsuits over its pre-bankruptcy investment in the stock platform Embed and its payments to Genesis Global Capital, the bankrupt lending arm of crypto firm Genesis.
FTX on Wednesday announced a settlement with the Metropolitan Museum of Art, in which the museum agreed to return $550 million in donations that it received from FTX companies in 2022.
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