SBF Parents Plead for Dismissal of Lawsuit in Latest FTX Drama
- FTX targets SBF’s parents, Joseph Bankman and Barbara Fried, in lawsuit seeking USD $10M cash gift and $16M Bahamas property.
- FTX alleges parents were company insiders, responsible for questionable donations and directing business payments
- Bankman and Fried deny all claims, suggesting they are just victims of circumstance and were not involved in defrauding FTX customers as suggested.
The biggest story of last year was Sam Bankman-Fried being tried, convicted and sentenced to prison. But the crypto world hasn’t yet dusted its hands of the calamitous FTX collapse which wiped over AUD $10 billion from the industry. There are still thousands of people owed money, and as bankruptcy proceedings started to kick off, an unexpected twist occurred in the FTX plotline – the exchange itself sued SBF’s parents, Joseph Bankman and Barbara Fried.
$10M Cash Gift and Luxury Property at the Core of Negotiations
The defunct crypto exchange, which may see a shock revival sometime in the future, took aim at SBF’s parents in September last year. FTX accused them of being company insiders who were responsible for the business making donations – such as to Barbara Fried’s political organisation Mind the Gap. As part of their attack, FTX is targeting various assets that SBF handed over to his parents, including:
- A USD $10 million (AUD $15.26 million) cash gift. SBF’s father, Joseph Bankman advised him on the tax requirements of this gift.
- A USD $16.4 million (AUD $25 million) luxury property located in the Bahamas, which was reportedly used to house various FTX employees and was never the principal residence of SBF’s parents.
SBF’s Parents Repute All Claims
Barbara Fried and Joseph Bankman have denied all of FTX’s allegations, yesterday filing a motion for dismissal to the US bankruptcy judge overseeing the case. In the documents, SBF’s parents claimed that the lawsuit was simply FTX attempting to “capitalise on the sheer fact” and that they never actually held any sway or official position within the crypto exchange.
The move comes as part of a broader strategy from the current FTX board, who have sued many former employees and company partners for their role in the platform’s collapse in 2022. So far, they have reclaimed more than USD $7 billion (AUD $10+ billion) in assets since proceedings began. The goal is to pay back all creditors, although if the Mt. Gox debacle is anything to go by, it might be years before the average customer sees even a cent.
Ben Knight
Ben Knight is a writer and editor from Melbourne with a passion for all things music and finance. He enjoys turning complex topics – especially the technical details of cryptocurrency – into digestible bites that anybody can understand. He acquired his Master’s in Writing, Editing and Publishing from RMIT in 2019 and has run his own creative writing business ever since.
