Bankman-Fried’s Father Paid Legal Bills With Alameda Research Money Gifted To Him: Report
By Benzinga
As Sam Bankman-Fried, the embattled founder of the now-defunct cryptocurrency exchange FTX awaits his sentencing, the source of his legal war chest has been a substantial monetary gift to his father, made with funds from a loan by FTX's sister company, Alameda Research, according to a report.
The connection between Bankman-Fried's defense and the controversial use of Alameda Research funds comes at a time when the industry is under intense scrutiny, a topic that will be thoroughly explored at Benzinga's Future of Digital Assets conference on Nov. 14.
Bankman-Fried, convicted on seven counts of criminal fraud brought against him, maintained his innocence, asserting earlier this year, "I didn’t steal funds, and I certainly didn’t stash billions away."
Despite these claims, Forbes' sources disclosed that in 2021, while serving as CEO of FTX, he transferred millions to his father, Stanford Law professor Joseph Bankman, by exploiting a tax exemption.
The strategy behind Bankman-Fried's defense funding raised further questions, given that FTX's collapse involved the alleged redirection of $10 billion in customer deposits to Alameda Research for trading activities that were never realized.
The sum of his defense, which is likely in the millions, is starkly contrasted by the billions that reportedly remain unaccounted for.
Both Mark Cohen and Christian Everdell, former federal prosecutors now representing Bankman-Fried, along with pro bono advisor David W. Mills, have refrained from commenting on these financial arrangements.
Meanwhile, Bankman-Fried's parents have reportedly pledged substantial personal assets to support their son, including leveraging their California home for his $250 million bail.
The scandal has left Bankman-Fried's previous fortune in ruins, with the former billionaire's net worth dissolving as his assets were tied to FTX's fate.
Read Next: Fidelity Exec Likens Bitcoin To Gold, Revisits Thesis: It's A 'Commodity Currency'
Industry titans BlackRock, DTCC, OCC, State Street, Société Générale, Hedera, Citi, BMO, Northern Trust, Citibank, Amazon, S&P Global, Google, Invesco, and Moody’s will join Benzinga on Nov. 13 for Fintech Deal Day and Nov. 14 for Future of Digital Assets. Secure a spot here to join them!
Photo: Created by MidJourney
