The cryptocurrency exchange FTX, which has gone bankrupt, has taken legal action against Sam Bankman-Fried’s parents, Joseph Bankman and Barbara Fried, to “recover millions of dollars in fraudulently transferred and misappropriated funds,” the company said in a Monday court filing.
The document, with some parts redacted to keep information private, requests the court to grant compensation to the FTX estate.
This compensation includes getting back any assets or money that FTX gave to the parents previously and additional damages as a penalty for their deliberate and harmful actions.
The filing stated, “FTX Trading paid $18,914,327.82, inclusive of taxes, fees, and costs, for Blue Water, to which Bankman and Fried received title, as well as various expenses related to Blue Water totaling more than $90,000.”
The filing also alleged that “Bankman’s command of tax law and unique understanding of the FTX Group’s muddled corporate structure allowed him to facilitate the transfer of a cash gift totaling $10 million to himself and Fried, consisting of Alameda Ltd. funds.”
Both Bankman and Fried work as professors at Stanford Law School. The complaint also claims that Bankman assisted other FTX company insiders in spending FTX Group’s money on donations and played a role in concealing a whistleblower complaint dating back to September 2019.
“Bankman and Fried deployed their decades of experience as sophisticated law professors and veneer of legitimacy not to help the FTX Group, but rather to plunder it in order to enrich themselves and their pet causes,” the filing stated.
Barbara Fried was the “point person” for SBF’s political contribution strategy, the filing said. Additionally, she used her “access and influence to benefit MTG [Mind the Gap], an independent expenditure-only political action committee that she co-founded in 2018 and for which she served as President and Chair.”
The document claims that Barbara Fried requested and received tens of millions of dollars in contributions for either herself or causes supported by her.
The filing didn’t specify the exact amount of money that Bankman and Fried may have taken inappropriately, but it did list some expenses.
FTX claims that one or both of them might have used company funds for things like $1,200-per-night hotel stays, plane tickets, and their salaries. Bankman was paid $200,000 each year for his job as a senior adviser to the FTX Foundation.
He also spent over $18 million on a property in the Bahamas and donated $5.5 million from FTX Group to Stanford University.
Also Read: Sam Bankman-Fried’s Elite Parents Fuel Crypto Rise
