A bankruptcy court in Delaware is soon expected to make a decision regarding the legality of a request to change ownership of an account now worth an estimated USD $59 million. The case has origins going back to the FTX scandal of 2022, with more recent layers of fraud and obfuscation accumulated on top.
At the center of this legal morass is Bang, a South Korean national found guilty of criminal fraud by the Korean courts back in August 2024 for his role in running operations at B&S Holdings as a Ponzi scheme. Bang made concerted and continual efforts to hide the true nature of his dealings, Korean judges said, and when Delio and Haru publicly collapsed, thousands of investors lost much of their lifelong savings.
Bang’s involvement in unethical business practices didn’t stop there, however. It turned out that Bang’s Ponzi play was to hide the fact that he had secretly moved his FTX assets into a Panamanian shell company, Lemma Technologies.. In 2023, less than a year after FTX had declared bankruptcy, Bang tried to sell these Panama accounts to Attestor Ltd—a corporate salvage yard—for pennies on the dollar. As global crypto value experienced a sharp rise, however, Bang got cold feet and made sure that Lemma ghosted Attestor.
One FTX account hidden under Lemma’s name holds over $59M in cryptoassets, and that is where our Delaware court comes into the picture. Two Korean individuals with no record of losses suffered by fraud, Lim and Choi, filed a motion to seize control of that very account. Their rationale? That Bang forgot to mention that he was just an agent and that Lim and Choi were the true owners of this FTX account. Bang himself subsequently endorsed this motion and requested that this secret Panama account be transferred just like Lim and Choi’s asked.
An effort is now underway by the FTX Recovery Trust to deny this motion. Attestor has a pending lawsuit against Lemma for the sale that was never completed, and numerous other creditors need an opportunity to lay their own claims for some of the assets in these accounts. The Delaware court will now have to decide: Should the parties that were actually confirmed by the Korean criminal courts to be the victims harmed by Bang’s crime be given a chance to recover their damages? Or does the criminal get to have the power to decide who gets to enjoy the fruits of his fraudulent scheming. The court will hold a hearing about the issue at the end of February. The judge’s answer is imminent.
