Court filings have revealed that the founder of the defunct Crypto firm FTX, Sam Bankman Fried, took more than $2bn from FTX-linked entities into his personal account.
The US bankruptcy court filings in Delaware made by FTX’s new management revealed how Bankman-Fried and five members of his inner circle transferred $3.2bn into their personal accounts through “payments and loans”.
The funds transferred, including $2.2bn said to have been taken by Bankman-Fried, mostly came from Alameda Research, a crypto trading hedge fund affiliated with FTX.
Three FTX insiders – Gary Wang, Nishad Singh, and Caroline Ellison have transferred a total of more than $800m. All three have pleaded guilty and are cooperating with prosecutors. Ellison, the former head of Alameda who received $6m, has said that Alameda had “an unlimited line of credit on FTX.com” from 2019 to 2022.
FTX’s new CEO John Ray has said that the $3.2bn did not include the $240 million spent to purchase a luxury property in the Bahamas, political and charitable donations made directly by the FTX debtors, and substantial transfers to non-debtor units in the Bahamas and other jurisdictions.
The new CEO, John Ray, has said he is leading, leading efforts to recover cryptocurrency and other assets to return to millions of FTX customers expected to lose funds on the bankruptcy. Accounts belonging to the crypto firm have been frozen since its collapse.
Bankman-Fried is detained at his parent’s home in California until the trial begins – expected to be in October. Prosecutors have charged Bankman-Fried with several counts of Fraud, stealing billions of dollars in FTX customer funds to plug losses at Alameda Research and making tens of millions of dollars in illegal political donations to buy influence in Washington, D.C. He denies wrongdoing and is fighting to stay out of jail pending his scheduled Oct. 2 fraud trial.