Former U.S. Securities and Exchange Commission (SEC) internet enforcement chief John Reed Stark backed crypto investors in a lawsuit filed against the National Basketball Association (NBA). In a statement made on Feb. 8, Stark criticized the NBA for approving a partnership between bankrupt cryptocurrency exchange Voyager Digital and the Dallas Mavericks, prompting a class-action lawsuit from investors. The partnership between Voyager and the NBA team, announced in October 2021, comes as the cryptocurrency exchange made false claims about investor protection.

The same should be true for the NBA's crypto partnerships, Stark noted. Voyager filed for bankruptcy in July 2022 following the crypto market crash, and in October 2023, nearly eight months after the Mavericks partnership, the U.S. Commodity Futures Trading Commission and Federal Trade Commission (FTC) filed a lawsuit against former Voyager CEO Stephen Ehrlich in line with fraud charges against former Voyager CEO Stephen Ehrlich. filed lawsuits.

The cryptocurrency exchange reached an agreement with the FTC in November 2023 for $1.65 billion in financial assistance. Stark implied that the NBA should also face criminal charges outside of the civil class-action lawsuit filed on Feb. 6 for its alleged role in misleading investors.

Voyager's trial in the U.S. Bankruptcy Court for Southern New York was ongoing at the time of publication. A restructuring plan has been proposed that envisions recovering 35.7% of Voyager customers' claims in cryptocurrency or cash by May 2023.

Stark worked with the SEC as an enforcement attorney and led the Internet Enforcement Office, where he served for a total of 18 years. He is currently president of John Reed Stark Consulting.