FTX Files Lawsuit Against Sam Bankman-Fried’s Parents

Beleaguered crypto exchange FTX has filed a lawsuit against Sam Bankman-Fried’s parents Allan Joseph Bankman and Barbara Fried. Debtors FTX and Alameda Research aim to recover millions of dollars in fraudulently transferred and misappropriated funds by Sam Bankman-Fried’s parents during FTX’s earlier years. Earlier this year, FTX lawyers accused Sam Bankman-Fried of funding legal defense with money he gifted to his father.

FTX To Claw Back Millions From Sam Bankman-Fried’s Parents

According to a court filing late September 18, FTX Trading seeks to recover damages from Sam Bankman-Fried’s parents Allan Joseph Bankman and Barbara Fried for direct and indirect transfers out of FTX and affiliated companies.

“Bankman-Fried’s parents, Bankman and Fried exploited their access and influence within the FTX enterprise to enrich themselves, directly and indirectly, by millions of dollars, and knowingly at the expense of the debtors in these Chapter 11 Cases and their creditors.”

FTX Group was indeed a self-described “family business,” run to benefit a group of insiders. Bankman as an advisor played a key role in perpetuating a “culture of misrepresentations and gross mismanagement.” He even helped cover up allegations against the firm and its insiders.

Sam Bankman-Fried’s parents Bankman and Fried siphoned money in millions out of the FTX Group for their own personal benefit. FTX urges the court to hold them accountable for their misconduct and recover assets for creditors.

FTX has accused Bankman and Fried on 12 counts including fraud, aiding and abetting breaches, and breaches of fiduciary duties. Also, the debtors have submitted enough evidence of fraudulent transfers for personal benefits, political donations, and protecting its insiders.

Also Read: Ethereum Whale Makes Massive Transfer; Caution For ETH Holders?

Sam Bankman-Fried Awaits Trial

With the trial scheduled to resume in early October, Sam Bankman-Fried was put in jail after the judge revoked his bail due to witness tampering. Since then, prosecutors have attacked SBF and his parents for various violations during the bail.

Sam Bankman-Fried has failed to receive pretrial bail. Also, he is denied vegan food and getting normal food as per the law. The trial will be crucial for Sam Bankman-Fried as authorities gets strict regarding crypto crimes.

Also Read: US SEC Fails In Securing the Inspection of Binance US Software