The aftereffects of a 2023 security incident at Kroll are once again impacting the FTX situation, as creditors are now pursuing legal action. With the third round of claim repayments approaching, lead plaintiff Repko, among others, is seeking justice and demanding comprehensive platform security enhancements.
FTX Creditors Sue Kroll Over Data Breach
Attorney Nicholas Hall announced via social media platform X the filing of a class action lawsuit against Kroll Restructuring Administration. Kroll, responsible for handling claims related to the FTX bankruptcy, faces allegations of negligence stemming from a data breach impacting FTX, BlockFi, and Genesis bankruptcy cases.
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- Source: X, Nicholas Hall
This legal action addresses the risks and uncertainties creditors have faced when trying to recover funds following the FTX collapse. The core issue revolves around the August 2023 data breach, where hackers compromised a Kroll employee’s mobile device, gaining unauthorized entry into the company’s cloud systems.
During the intrusion, hackers obtained sensitive user data, including names, physical and email addresses, and FTX account balances. While FTX passwords and assets remained secure, the compromised data opened the door to potential phishing schemes targeting users.
Adding to the problem, Kroll’s communication strategy relied solely on email alerts, which critics say was inadequate for properly informing creditors.
FTX Creditors Targeted by Phishing Scams
Immediately after the breach, FTX creditors found themselves bombarded with fraudulent emails, some cleverly disguised as official FTX communications. Community member Sunil pointed out instances where emails contained creditors’ full names, suggesting a data leak. Plaintiff Repko reported losing 1.9 ETH in July 2025 due to a phishing attack traced back to this breach.
Warning: Phishing Scam Email
Full name, email addresses of FTX creditors revealed
New or old data leak
1) Do not click on email links
2) Check Sender addresses
3) Go direct to claims portal or official address. Do not click on links in emailsFTX claims:… pic.twitter.com/GK1nrYSpLO
— Sunil (FTX Creditor Champion) (@sunil_trades) August 13, 2025
Even the official Joint Official Liquidators of FTX Digital Markets Limited issued a public statement acknowledging the rising number of phishing attempts targeting creditors. This lawsuit underscores the unreliability of Kroll’s email notification system and significant vulnerabilities in their overall management practices.
We are aware of an increase in FTX creditors being targeted with phishing emails that look like they are from the Joint Official Liquidators and fraudulent websites designed to look like the FTX Digital Claim Portal in order to trick creditors into providing personal information…
— FTXDigitalMarketsLiquidation Official (@FTX_DMOfficial) August 22, 2025
Further complicating matters, users have experienced issues with KYC verification, with their status inconsistently switching between ‘Verified’ and ‘Hold.’ Tax form submission problems also exist, preventing creditors from uploading necessary documents.
What Happens Next?
Through this lawsuit, FTX creditors are seeking significant systemic changes and compensation for damages incurred. Their proposed changes include implementing multi-channel notifications, enabling manual tax form uploads without KYC restrictions, enhancing security measures, conducting an independent audit of Kroll’s security protocols and claim-handling procedures, and other improvements.
If the court rules in favor of the creditors, potential outcomes could include financial reparations, operational overhauls, and other forms of relief.
Costs you nothing.
Potential outcomes—if the Court certifies the case and later approves a settlement or enters judgment—can include two things:
• Monetary relief for eligible class members (for example, up to $750 or actual damages for California victims, but depends on…— Nicholas Hall (@nicholashall) August 21, 2025
While the lawsuit proceeds, creditors are also anticipating the upcoming third round of FTX distributions, totaling $1.9 billion. These payments are scheduled for September 30, 2025, and will be processed via BitGo, Kraken, and Payoneer.
Experts are cautioning users to be vigilant, as scammers are likely to exploit the payout timeline, potentially leading to further fraudulent activity.
Frequently Asked Questions (FAQs)
Hackers accessed sensitive customer information, including names, email addresses, physical addresses, and FTX account balances.
Many creditors have been targeted with phishing emails, with some falling victim to scams resulting from the data breach.
The third distribution of reimbursements, amounting to $1.9 billion, is slated for September 30, 2025.
Pooja Khardia
Pooja Khardia is a seasoned crypto content writer with 6+ years of experience in writing, including in blockchain, cryptocurrency, DeFi, and digital finance reporting. In her adventure journey, she is currently working with CoinGape Media and leading their Trending Section. Here, she uses her expertise to deliver analytics, market insights, price predictions, and information on what’s trending in the crypto space, aiming to keep the crypto and web3 community updated with market trends and important insights. Known for a user-centric and straightforward writing style, Pooja is passionate about making crypto easy and accessible. Her writing blends market research with storytelling, helping readers stay ahead in a fast-paced industry. When not behind the keyboard, Pooja embraces her creative side through drawing and crafting. Connect with Pooja on LinkedIn or X.
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