- FTX administrators filed that the funds were deployed for Sam Bankman-Fried’s “personal aggrandizement” rather than actual scientific advancements and innovation.
- Bankman-Fried’s NGO Latona received over $71 million from the crypto exchange and sister firm Alameda Research between February and October 2022.
- The bankrupt crypto firm had recovered $5 billion in customer cash and cryptocurrencies as of January 2023, lawyers for the exchange said.
Bankruptcy CEO John Ray and the FTX bankruptcy team filed to recover millions in customer funds redirected to Sam Bankman-Fried’s Latona, a Bahamas-based non-profit organization focused on supporting scientific innovation.
The crypto exchange and sister firm Alameda Research transferred $71.5 million to the FTX Foundation and SBF’s NGO Latona which then invested the money in life science companies like Lumen Bioscience, Genetic Networks, and GreenLight Biosciences.
Lawyers for the bankrupt crypto exchange argued that Latona was a sham NGO touted to serve altruistic purposes when in reality, the firm used commingled funds from Alameda and FTX accounts for “Bankman-Fried’s personal aggrandizement”.
While purporting to make these investments for altruistic purposes Bankman-Fried in fact pursued these transactions because he believed that doing so would generate goodwill and amass political capital and influence for himself.
FTX Fund Recovery
Administrators for the bankrupt crypto exchange continue to hunt down misappropriated funds from SBF’s leadership of FTX and Alameda Research. Lawyers said bankruptcy CEO John Ray and his team had recovered $5 billion in customer crypto and funds back in January.
In June, FTX attorneys filed to recover an additional $700 million transferred to investment shop K5 Global in 2022. The lawsuit alleged that Bankman-Fried transferred millions to K5 Global co-founder Michael Kives and Bryan Baum after attending a party featuring high-profile attendees like ex-presidential candidate Hillary Clinton.
Entities like the New York Metropolitan Museum also plan to return funds donated by Bankman-Fried’s companies in a bid to stem legal clawback and bad press.