Lawsuit Alleges Parents of Former FTX CEO Involved in Fraudulent Activity

Lawsuit Alleges Parents of Former FTX CEO Involved in Fraudulent Activity

A new lawsuit filed by FTX’s debtors in a Delaware federal court alleges that Barbara Fried and Joseph Bankman, parents of former FTX CEO Sam Bankman-Fried (SBF), were directly involved in fraudulent activity and misappropriation of funds. The lawsuit claims that the couple exploited their access and influence within the crypto company to enrich themselves. FTX, now bankrupt and under new management, accuses SBF’s parents of making off with millions of fraudulently transferred funds. The lawsuit also alleges that the couple advocated for charitable donations, including to Stanford University, seemingly to boost their professional and social status.

Stanford University confirmed that it had received gifts from the FTX Foundation and “FTX-related companies” for pandemic-related prevention and research. The university spokesperson stated that they are in discussions with the FTX debtors’ attorneys to return these funds in their entirety.

Attorneys representing Fried and Bankman have called the lawsuit a “dangerous attempt to intimidate” and undermine the jury process. They deny the allegations, stating that the claims are false.

The FTX debtors are seeking damages for the FTX estate and the return of any payments or property given to SBF’s parents. They are also demanding punitive damages for the parents’ alleged conscious, willful, wanton, and malicious conduct.

Joseph Bankman, a tenured tax law professor at Stanford University, is accused of playing a key role in perpetuating a culture of misrepresentations and mismanagement at FTX. The lawsuit claims that Bankman used his expertise to manage tax issues, select charitable contributions, and strategize loans issued by FTX. It is alleged that Bankman used the funds obtained from FTX to finance lavish expenses and gifts for friends and family.

Barbara Fried, SBF’s mother, allegedly played a significant role in advising SBF and FTX’s political contributions. She allegedly instructed SBF to donate millions of dollars to a political action committee called Mind the Gap, which she co-founded and served as president of. SBF is accused of embezzling around $100 million from customers’ crypto accounts to fund campaign contributions.

The FTX debtors are requesting the court to award damages to the FTX estate and return any payments or property given to SBF’s parents. They are also seeking punitive damages for the parents’ alleged conduct.

 

CrimeDoor
Author: CrimeDoor

Leave a Reply

Share on:

[mailpoet_form id="1"]

Subscribe to Our Newsletter