FTX Claims Sam Bankman-Fried Plundered $2.2 Billion in ‘Loans and Payments’ as CEO
FTX founder Sam Bankman-Fried has been accused of taking more than $2 billion in “loans and payments” from the firm during his time as CEO. Democrat megadonor SBF faces allegations of committing massive fraud using his cryptocurrency exchange and trading firm.
Intelligencer reports that Sam Bankman-Fried, the founder of the failed cryptocurrency exchange FTX, received a staggering $2.2 billion in loans and payments while allegedly committing a massive fraud within the business, according to a late-night announcement made by liquidators on Wednesday. As federal investigators construct their case against Bankman-Fried, who is currently facing 12 charges, including money laundering and bank fraud, the revelation may have a significant impact on his case.
Bankman-Fried reportedly obtained more than $2 billion in loans, mainly through the hedge fund he founded, Alameda Research, according to documents filed with the bankruptcy court. Alameda allegedly misappropriated customer deposits from FTX accounts in an effort to cover its losses after suffering losing large amounts of money on bad investments.
Bankman-Fried wasn’t the only executive to receive compensation through Alameda. Nishad Singh, a former director of engineering, received $587 million, while Gary Wang, a co-founder, received $246 million. Ryan Salame, a former co-CEO, received $87 million, and John Samuel Trabucco, former co-CEO of Alameda, received $25 million. Bankman-Fried’s ex-girlfriend Caroline Ellison, who also once served as Alameda’s CEO, received loans and payments totaling a comparatively modest $6 million.
The combined $3.2 billion that the top executives at FTX and Alameda effectively lent themselves does not include the $240 million spent on luxury real estate in the Bahamas or the direct political contributions made by FTX, according to the company’s new management. This most recent revelation appears to support Caroline Ellison’s earlier claims, which she made in December when she told a judge that Alameda had secretly loaned company executives billions of dollars.
Ellison, Wang, and Singh, are all reportedly cooperating with the government as part of their guilty pleas to fraud charges, and are likely assisting federal investigators in checking these unusual loans and payments as they build a case against Bankman-Fried. SBF, who is under house arrest and residing with his parents, has entered a not-guilty plea.
The news released on Wednesday is encouraging for FTX customers who are owed money because the company has promised to recover the billions of dollars that Bankman-Fried and other top executives misplaced. But there is still a long way to go before everyone is whole: FTX’s new management stated that although the “amount and timing of eventual monetary recoveries cannot be predicted at this time,” the firm is confident that further research will unearth even more “assets, liabilities, and transfers” hidden in the company’s infamously poor bookkeeping records.