Bankrupt crypto exchange FTX has reportedly charged the embattled CEO Sam Bankman-Fried’s parents to court over alleged misappropriation of funds. According to reports, debtors of the bankrupt derivative exchange have filed a lawsuit against both parents of SBF – Joseph Bankman and Barbara Fried.
The lawsuit which was filed on Monday, September 18, accused the parents of helping to misappropriate funds worth millions of dollars rightfully belonging to the exchange customers through their involvement in the company.
Specifically, FTX legal counsel is urging the court to compel the parents to return any donations in the form of property or cash from the FTX estate when it was still fully functional.
The complainant alleges that Sam Bankman-Fried’s Parents used their position in the firm to enrich themselves at the expense of the exchange’s customers and investors. In addition, the plaintiff argued that Sam’s parents were fully involved in running the FTX business from the beginning up until its collapse in November 0f 2022 as opposed to what SBF has claimed.
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Furthermore, the plaintiffs claimed that through their involvement with the FTX empire, Bankman and Fried collected unearned rewards including a cash gift of about $10 million and a luxury property in the Bahamas worth $ 16.4 million.
Bankman also used FTX’s money to cover personal costs, including a $1,200-per-night hotel lodge and privately chartered jets. Similarly, SBF’s mother Barbara Fried was accused of compelling her son to make donations to Mind the Gap (MTG) – her political action committee.
Even though the lawsuit didn’t mention the exact amount of money donated to Barbara Fried’s campaign, it was said to have been tens of millions of dollars.
Bankman and Fried should be held accountable
FTX legal counsel has asked the court to hold both parents accountable for their actions in order to recover the assets.
“Award plaintiffs punitive damages in an amount to be determined at trial resulting from defendants’ conscious, willful, wanton, and malicious conduct, which exhibits a reckless disregard for the interests of plaintiffs and their creditors,” a part of the lawsuit says.
Before its collapse, FTX was one of the largest cryptocurrencies in the world accounting for over 5 million active users. The FTX court case remains one of the highest-profile cases in the crypto industry to date.
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A collective loss worth billions of dollars belonging to customers is still yet to be accounted for. However, the present management team behind FTX is doing all they can to retrieve the funds from various sources.
Ultimately, the lawsuit filed against Sam Bankman-Fried’s parents has been applauded as a welcome development as the unspoken immunity enjoyed by Joseph and Barbara while SBF sits in prison has been called out.
SBF’s trial is scheduled to begin on October 3 where he will be charged with seven counts relating to mishandling of users’ funds at FTX and Alameda Research.
Read Also:
- FTX Aims to Retrieve $3.9 Billion in Cash and Cryptocurrency from Genesis in Legal Battle
- SEC Gets Another Partial Setback in the Case Against Binance US; What Does This Imply?
- Dormant Bitcoin Whale Reemerges, Moves 2100 BTC to New Address
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Victor Swaezy
Victor Nnamdi Igbor "Swaezy" is a crypto enthusiast and writer with over 8 experience in blogging. He is an easy person and when not working, loves to have a good time.