FTX has decided to go after the parents of founder Sam Bankman-Fried, claiming that they enriched themselves through the now-bankrupt crypto exchange.
Under the leadership of restructuring specialist John Ray, FTX is now suing Joseph Bankman and Barbara Fried – parents of imprisoned founder Sam Bankman-Fried – for using the crypto exchange to enrich themselves at the expense of customers.
According to a «Reuters» report citing the lawsuit, FTX was being run as a «family business» and misappropriated billions in customer funds for the interest of a few insiders, including Bankman and Fried.
The two allegedly benefited from a $10 million cash gift, a $16.4 million lux property in the Bahamas from FTX and tens of millions of dollars in charitable contributions, including to Stanford University where Bankman is a tax specialist within its law school.
«Adult in the Room»
The lawsuit also revealed the nature of some of the business dealings, especially with regard to Bankman-Fried’s role in FTX. FTX alleges that Bankman often positioned himself as the «adult in the room» next to his son and other executives with little management experience.
Fried is also allegedly a key player with the strongest influence on political contributions. Millions of dollars were directed to a political action committee that she co-founded.
FTX filed for bankruptcy in November 2022 and since then, more than $7 billion in assets have been recovered to repay customers with more lawsuits underway to pursue additional assets. Bankman-Fried has pleaded not guilty to the fraud charges and is currently in jail ahead of his trial on October 3.
