Sam Bankman-Fried paid his legal defense team $10 million using funds that were stolen from FTX’s sister hedge fund, Alameda Research — and which had been gifted to the 31-year-old crypto crook’s father, a new lawsuit alleges.
The complaint — filed in Delaware bankruptcy court on Thursday — divulged that a so-called “Bankman Gift Transfer” for $10 million was made from Bankman-Fried’s FTX account “to his father’s personal account on the FTX US exchange.”
“On information and belief, Bankman-Fried’s father has been using this ‘gift’ to finance Bankman-Fried’s criminal defense,” the documents stated.
The complaint confirmed previous reports that Bankman-Fried was using the “large monetary gift” he sent to his father, longtime Stanford University law professor Joseph Bankman, to pay for his expensive legal defense.
The Post has reached out to Joseph for comment.
Bankman-Fried sent the funds to his attorney dad in January 2022, after initially transferring the $10 million “containing debtor assess” to an FTX account in his own name, according to the filing.
“One minute later,” Bankman-Fried then transferred the lump sum to his father.
“In an email exchange, Bankman-Fried and his father discussed structuring the $10 million gift as a loan from Alameda to Bankman-Fried,” the court documents said, suggesting that the money was not actually a present from son to father.
FTX lawyers’ also noted in the filing that “the debtors have been unable to identify any promissory note, long agreement or other indication that the funds were not simply taken from Alameda by Bankman-Fried to enrich his family.”
The court documents were filed by FTX against a handful of its executives, including Bankman-Fried, co-founder Gary Wang, engineering director Nishad Singh and former Alameda CEO Caroline Ellison.
It’s seeking $1 billion in damages, claiming the company’s so-called philanthropic organization was misappropriated by FTX’s bosses.
It’s the latest development in a case that began in November, when Bankman-Fried’s crypto exchange imploded following a CoinDesk report that revealed Bankman-Fried misappropriated customers’ money to fund a lavish lifestyle that included elaborate advertising campaigns and hefty political donations.
Bankman-Fried has since been charged with over a dozen counts related to conspiracy to commit bank fraud as well as conspiracy to commit wire fraud against FTX customers and other related crimes.
If found guilty following a trial that’s slated to begin on Oct. 2, he faces 155 years in jail.
After being released on a record-breaking $250 million bail bond following his extradition from the Bahamas, Bankman-Fried has reportedly been holed up at his parents’ Palo Alto home with an ankle monitor.
The Post has reached out to Bankman-Fried’s counsel, hard-charging lawyers Mark Cohen and Christian Everdell of New York firm Cohen & Gresser — both former prosecutors who were part of Ghislaine Maxwell’s defense team — for comment.
Cohen and Everdell’s profiles on Cohen & Gresser’s site market them as experts in litigation involving white collar crime.
Bankman-Fried is just one of the crypto firm’s executives facing jail time.
Ellison, Bankman-Fried’s former lover and Alameda’s ex-chief behind, was also looking at more than a century behind bars, though she skirted the sentence by agreeing to cooperate with the federal government in a plea deal she struck in December.
It’s unclear how much lighter her sentence is about to get, though experts have said the 28-year-old could serve no time at all after serving as the star witness in Bankman-Fried’s criminal trail this fall.
This story originally appeared on NYPost
