16th March 2023 – (New York) The bankruptcy filing of cryptocurrency exchange FTX has revealed that transfers of around $2.2 billion were made to company founder Sam Bankman-Fried through related entities, with over $3.2 billion transferred in total to company founders and key employees. FTX stated that these payments were primarily made from Alameda Research hedge fund, and that the disclosures were made by filing schedules and statements of financial affairs with the bankruptcy court.
The transfers did not include over $240 million spent on 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 transfers have drawn attention from prosecutors, who have charged Bankman-Fried with stealing billions of dollars in FTX customer funds to cover losses at Alameda Research, and with making tens of millions of dollars in illegal political donations to buy influence in Washington, D.C.
FTX filed for bankruptcy protection in November, stating that it was unable to completely repay customers who had deposited funds on its exchange. The new CEO, John Ray, has made it clear that his top priority is recovering assets to repay FTX customers. The bankruptcy filing has revealed the extent of the transfers made to founders and key employees.
FTX has disclosed that the transfers were made chiefly from Alameda Research hedge fund, which is controlled by Bankman-Fried. The transfers were made through related entities, and were made both in the form of payments and loans. The company has stated that it made these disclosures by filing schedules and statements of financial affairs with the bankruptcy court.
The transfers have drawn attention from prosecutors, who have charged Bankman-Fried with stealing billions of dollars in FTX customer funds to plug losses at Alameda Research, and with making tens of millions of dollars in illegal political donations to buy influence in Washington, D.C. Bankman-Fried has denied any wrongdoing, and is fighting to stay out of jail pending his scheduled 2nd October fraud trial.