New Court Filing Reveals Unusual Family Dynamic in FTX’s Bankruptcy Case
A recent court filing in the bankruptcy case of FTX, the crypto company founded by Sam Bankman-Fried, has shed light on a unique family dynamic within the company. It appears that Sam’s father, Joe Bankman, initially received a $200,000 salary from FTX, but expressed dissatisfaction and expected to be paid $1 million annually. In response, he involved his wife, Barbara Fried, in the matter. The filing further reveals that the couple received significant financial benefits, including a $10 million gift and a $16.4 million property in The Bahamas, both of which were linked to FTX funds.
According to the court filing, Sam Bankman-Fried viewed Alameda Research, a central firm in the FTX empire, as a “family business.” This revelation adds a new dimension to the story of FTX’s downfall. The court filing suggests that Joe Bankman’s influence played a role in the management of the company. In a message to an FTX executive on January 12, 2022, Joe Bankman stated that he was supposed to receive $1 million annually starting the previous month, contradicting his $200,000 salary.
Joe Bankman then emailed his son, expressing his surprise at the $200,000 salary and stating, “This is the first [I] have heard of the 200K a year salary! Putting Barbara on this.” Barbara Fried is Sam Bankman-Fried’s mother and the former CEO of FTX. The court filing indicates that Joe Bankman’s influence paid off not only for himself but also for Barbara Fried. Within two weeks, Sam Bankman-Fried gifted them both $10 million in funds originating from Alameda Ltd. Additionally, within three months, Sam Bankman-Fried facilitated the transfer of a $16.4 million property in The Bahamas to the couple, which was paid for with funds ultimately provided by FTX Trading.
The court filing also reveals that as early as 2018, Joe Bankman referred to Alameda Research as a “family business.” This label was used repeatedly, suggesting that the involvement of Sam Bankman-Fried’s parents in his business was not a recent development. While it was already known that Sam Bankman-Fried’s inner circle included senior executives who were his roommates, such as his ex-girlfriend Caroline Ellison, this latest revelation highlights the potential influence exerted by his parents.
In response to the lawsuit filed against them, Joe Bankman and Barbara Fried’s attorneys issued a statement, calling it a “dangerous attempt to intimidate” their clients and undermine the jury process. They described the claims as “completely false” and criticized FTX’s bankruptcy-era CEO, John J. Ray III, and his team of lawyers for running up substantial fees while providing limited returns to FTX clients.
The court filing provides an intriguing glimpse into the inner workings of FTX and raises questions about the extent of familial influence within the company. As the bankruptcy case unfolds, further details may emerge regarding the role played by Sam Bankman-Fried’s parents in the management and financial affairs of FTX.
Amitoj Singh contributed reporting to this story.