Joseph Bankman, the father of former FTX CEO Sam “SBF” Bankman-Fried, found himself embroiled in a family dispute over salary matters.
This familial clash spilled into the public eye as FTX debtors filed a complaint on September 18 in the United States Bankruptcy Court for the District of Delaware, accusing Bankman and Barbara Fried, SBF’s parents, of allegedly misappropriating millions of dollars within the FTX exchange’s operations.
According to official court documents, Bankman’s employment contract with FTX US had stipulated a $200,000 annual salary after his leave of absence from Stanford Law School in December 2021.
However, a puzzling discrepancy emerged as Bankman claimed to both FTX US and his son that he was anticipating a more substantial $1-million annual salary.
This confusion raised eyebrows, and Bankman seemed to imply that Barbara Fried might have influenced their son to endorse the salary alteration.
The complaint contends that Bankman’s influence did indeed have an impact, as SBF subsequently granted his parents numerous financial benefits.
These perks included a $10 million allocation from Alameda, a $16.4-million property in the Bahamas financed by FTX Trading, the ability to charge approximately $90,000 to FTX Trading in the Bahamas, and options to acquire company stock.
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As of the time of this publication, there has been no response from the legal team representing Bankman and Fried to these allegations.
This legal action represents the latest development in the ongoing bankruptcy case involving FTX and several of its subsidiaries, a case initiated in November 2022.
Meanwhile, Sam Bankman-Fried faces a series of 12 criminal charges, to be divided into two trials scheduled for October 2023 and March 2024.
Since his bail was revoked by a federal judge in August, Bankman-Fried has been primarily confined to the Metropolitan Detention Center in Brooklyn as he awaits his October trial.
On September 19, a three-judge panel entertained an appeal from SBF’s legal team, who sought his release from incarceration to adequately prepare for trial, citing concerns such as limited internet access and potential First Amendment issues in his current confinement.
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