I got here of my curiosity for safety. I lost some good fortune on the recent FTX collapse.
Kudos to you for having the courage to admit that you are one of the victims of something that smelled like a nasty scam from the beginning, and not because it was technically poorly designed, but because behind it all was a person who I personally would not let run a chicken coop. No matter how much this life lesson costs you, I hope you learn not to trust spoiled rich people no matter what fairy tales they tell.
Though I had passively heard little on such risk but it has never been detailed and explanatory. It was always directed to cases of individual(s) whose account(s) are suspended for further KYC on few occasions, which I merely viewed as person's found guilty of illegal activities on the exchange, and assumed such wouldn't ever be a risk for all. Not to think of a total collapse of such might.
Such things are always written in very fine print and no one reads them, and because of this, all those who make such scams can mostly get away with the help of an army of lawyers. I don't wonder at all if something like that will happen again, it's just a question of who is next - and I would say that these are the ones who are the loudest in terms of bragging that they are the best, but in fact they are one step away from everything collapses like a house of cards.