- Sam Bankman-Fried’s parents have been sued by the FTX bankruptcy estate to clawback funds.
- The estate is attempting to recover millions of dollars in misappropriated funds.
- Joseph Bankman and Barbara Fried have been accused of exploiting their access to FTX to enrich themselves.
The bankruptcy estate of FTX has sued the parents of founder and former Chief Executive Sam Bankman-Fried in an attempt to clawback funds. The defunct crypto exchange’s managers are looking to recover millions of dollars in fraudulently transferred and misappropriated funds by Joseph Bankman and Barbara Fried.
According to a recent report by Bloomberg, Joseph Bankman and Barbara Fried have been accused of exploiting their access and influence over their son’s crypto exchange to enrich themselves at the expense of the firm’s customers. Both Bankman and Fried are tenured professors at the esteemed Stanford Law School.
The filing in the United Bankruptcy Court for the District of Delaware listed several instances of Bankman-Fried’s parents misappropriating FTX’s funds for personal endeavors. This included flights and tickets for a Formula 1 Grand Prix in France, and millions of dollars in donations for a super PAC (political action committee) to help the Democrats during the 2020 US election cycle.
“Bankman’s access and authority within FTX Trading, Alameda, Alameda Ltd., and FTX US gave him de facto officer, director, and/or manager status at each,” the court filing read, indicating Bankman’s vast influence over his son’s crypto conglomerate.
Bankman and Fried’s legal representatives released a joint statement which referred to the lawsuit by FTX’s bankruptcy estate as a dangerous attempt to intimidate them and undermine the jury process ahead of Bankman-Fried’s first hearing scheduled for the first week of October. The lawyers added that the allegations made by the estate were “completely false”.
The lawsuit against Sam Bankman-Fried’s parents comes months after repeated demands by FTX creditors and the broader crypto community to hold them accountable for their role in defrauding customers and the collapse of the crypto exchange.