Sam Bankman-Fried is paying defense lawyers with FTX funds: lawsuit
Sam Bankman-Fried is paying defense lawyers with FTX funds: lawsuit

Indicted FTX founder Sam Bankman-Fried leaves US courthouse in New York City on June 15, 2023.

Fresh Mike | Reuters

Sam Bankman-Fried, the co-founder of failed cryptocurrency exchange FTX, was sued in Delaware bankruptcy court on Thursday by former corporate lawyers, accusing him and members of his leadership team of stealing hundreds of millions of dollars.

Lawyers are seeking to recover money from Bankman-Fried and former executives of FTX and its sister hedge fund, Alameda Research. One way Bankman-Fried stole funds was by making a $10 million gift to his father, Joe Bankman, a prominent legal scholar, lawyers for the bankruptcy exchange said.

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Most of the $10M Donation Goes from FTX to Bankman-Fried Morgan Stanley Around January 2022, TD Ameritrade accounts will be deleted, the lawsuit said. Those proceeds are now being used to pay for Bankman-Fried’s criminal defense, the complaint says.

A representative for Bankman-Fried declined to comment.

Bankman-Fried was charged with fraud and bribery, as well as campaign finance violations, after FTX filed for bankruptcy late last year. His exchange, once valued at $32 billion, collapsed almost overnight as liquidity dried up and the company was unable to meet withdrawal requests from customers.

Bankman-Fried pleaded not guilty. His trial is expected to begin later this year.

Lawyers for FTX have been scouring the company’s remaining assets in an effort to recover as much money as possible for creditors.

Fortis Alameda executives Caroline Ellison, Gary Wang and Nishad Singh are co-defendants in the case with Bankman-Fried.

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