FTX Founder Sam Bankman-Fried’s parents, Joseph Bankman and Barbara Fried, have been hit with a lawsuit by the remaining members of the collapsed company. The court filing alleges that the Stanford University professors enriched themselves before the downfall of the once-prominent crypto trading marketplace. The complaint seeks to recover funds that were fraudulently transferred and misappropriated by Bankman and Fried, who allegedly capitalized on their access and influence within the FTX enterprise. The complaint describes FTX as a “family business” that siphoned off millions for personal gain.
Joseph Bankman, referred to as the de-facto executive of FTX Group, was an integral part of the management team. He allegedly dealt with tax deductions and issues, strategized on loans worth hundreds of millions of dollars, made recommendations on hiring, engaged in contract negotiations, advised on acquisitions, and participated in discussions regarding FTX-affiliated entities. Barbara Fried, on the other hand, is said to be the key advisor on political contributions made by Bankman-Fried and FTX Group.
While the collapse of FTX was imminent, the lawsuit claims that Bankman and Fried transferred millions to themselves, including the purchase of a $16.4 million property in the Bahamas. It remains to be seen if criminal charges will be filed against the parents in relation to the bankruptcy of FTX. The criminal case against Sam Bankman-Fried is expected to proceed later this fall.
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