FTX was run as Sam Bankman-Fried’s «personal fiefdom», according to a recent court hearing, with hundred of millions of dollars spent on real estate.
FTX had spent $300 million on real estate in the Bahamas such as homes and vacation properties for senior staff, according to a live stream of a hearing at the US Bankruptcy Court in Delaware.
A «vacation home» with beach access in Old Fort Bay showed Sam Bankman-Fried's parents, Joseph Bankman and Barbara Fried, as signatories, according to official property records. The records also showed that FTX, Bankman, Fried, and several senior executives bought $121 million worth of properties over the past two years, which were to be used as «residence for key personnel».
«Personal Fiefdom»
According to attorneys for FTX, the fallen crypto exchange was run as a «personal fiefdom» of ex-CEO Bankman-Fried.
«We have witnessed one of the most abrupt and difficult collapses in the history of corporate America,» said Sullivan & Cromwell’s James Bromley, adding that the proceedings allowed everyone to recognize for the first time that «the emperor had no clothes».
Attorneys also called for an investigation into the FTX stake sale in July 2021 by Binance. Binance, which was originally planning a rescue takeover before pulling out, first bought the FTX stake in 2019.
Cash Balance
Meanwhile, FTX currently has a cash balance of $1.24 billion as of Sunday, according to a separate filing on Monday by consultancy firm Ed Mosley of Alvarez & Marsal. This includes around $400 million in accounts related to affiliated trading arm Alameda Research and $172 million at FTX’s Japan unit.
This compares to the $3.1 billion owed to FTX’s 50 largest creditors.
