Key Takeaways
- The lawsuit comes after several users reported a major data breach that exposed the personal details of creditors linked to bankrupt crypto firms FTX, BlockFi and Genesis.
- The lawsuit claims that the data breach facilitated more phishing attempts as well as disrupted the claims verification process
Leading bankruptcy service provider Kroll has come under scrutiny after a class-action lawsuit alleged that the firm failed to protect sensitive information, leaving users exposed to phishing scams. The lawsuit comes after several users reported a major data breach that exposed the personal details of creditors linked to bankrupt crypto firms FTX, BlockFi and Genesis.
The lawsuit, filed in a U.S. district court, comes from Hall Attorneys on behalf of FTX customer Jacob Repko and others who say they were harmed by the breach.
The alleged data breach took place in August 2023, when malicious actors gained access to personal data tied to thousands of creditors. The lawsuit claims that the data breach facilitated more phishing attempts while also disrupting the claims verification process.
Taking to X, Sunil Kavuri, a FTX creditor with a significant following, said that creditors have been getting phishing emails daily. In his post, he included a screenshot, noting that he had received one recently with his name in the scam email.
The suit also highlights Kroll’s reliance on email-only communication, arguing that this approach created a dangerous single point of vulnerability. It further claims that the breach also led to some creditors experiencing delays or losses in their repayments.
Hall Attorneys has suggested that a favourable ruling could provide monetary damages for victims while also requiring Kroll to make operational changes. Nicholas Hall, who is leading the case, also manages the FTX Claims website, which has been assisting users with filing claims in the bankruptcy process.
This lawsuit follows a separate incident earlier this year. In March, Kroll was reported to have suffered another breach in which client invoicing data, accounts payable records and email addresses were obtained by hackers.
The latest legal scuffle comes amid FTX Trading Ltd. gearing up to resume creditor payouts on September 30, 2025, following a U.S. Bankruptcy Court in Delaware approving the release of $1.9 billion in funds for the third instalment of the firm’s repayment plan
