Mark Cuban in legal trouble over the promotion of Voyager
Due to his involvement in promotions of embattled crypto firm Voyager Digital, Mark Cuban is facing a class-action lawsuit. In the past few years, the billionaire has been a prominent figure in crypto. As disclosed, the plaintiffs alleged that Cuban presented the organization in a false manner that misled investors into business engagement with it.
Cuban appeared before the United States District Court in Southern Florida to defend claims about promoting some regulated products of the firm. The plaintiff, Moskowitz law firm, insists that a jury must sit to hear the case. According to the lawsuit, Cuban painted Voyager as a firm offering cheaper and commission-free services than its counterparts.
The law firm alleges that Cuban, alongside Voyager CEO Stephen Ehrlich with their experience, misled customers. Their act compelled the “inexperience customers” to commit their life savings to some of Voyager’s dubious products. The lawsuit alleges that the unregistered products are a Ponzi scheme that has robbed investors of their funds.
However, the lawsuit further illustrates Cuban’s awareness of the risks attached to the products. Yet, the lawsuit claims that the billionaire continued to hype these products, attracting numerous retail investors. A part of the filing recalls how Cuban described the Voyager platform as risk-free.
In addition, the law firm claims that Dalla Maverick, another defendant offered vocal support to promote the platform. More allegations pins that Cuban provided monetary assistance to the forum before its eventual struggles.
Voyager is one of the crypto lenders to Three Arrows Capital (3AC). The firm is currently struggling due to the 3AC bankruptcy crisis. Voyager has made numerous attempts to recover some of its funds with 3AC.
In one of its attempts, the firm issued a defaulting query to 3AC over its failure to service its loan. According to the firm, the loan with 3AC is about 15,250 bitcoins, which is worth about $324 million as of then. Also, it includes another $350 USDC. Then, Voyager sought the services of its legal team on how to pursue the recovery of the loan from 3AC.
Last month was action-packed for Voyager capital; within that period, the lending platform halted trading and withdrawal activities before filing for bankruptcy. At the moment, about 3.5 million customers of Voyager in the US have crypto assets worth about $5 billion withheld by the firm.
Meanwhile, some of its affected users have recovered their funds. A judge presiding over Voyager’s bankruptcy proceedings ruled that the firm should return about $270 million of customers’ funds to a bank. Consequently, Voyager allowed its users with US dollars in their account to withdraw about $100,000 within 24 hours, starting from today.
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