The parents of Sam Bankman-Fried, both professors at Stanford Law School, ask the Court to dismiss the lawsuit filed by FTX for fund recovery.
Joseph Bankman and Barbara Fried argue that there is no fiduciary relationship with the collapsed crypto-exchange.
Summary
Sam Bankman-Fried and the parents’ request to dismiss the FTX lawsuit for fund recovery
According to what is reported, it seems that Sam Bankman-Fried’s parents are asking the Court to dismiss the lawsuit filed by FTX against them for the recovery of funds.
Joseph Bankman and Barbara Fried, both professors at Stanford Law School, argue that Bankman would have no fiduciary relationship with the bankrupt crypto-exchange, FTX.
In practice, the document states that it is not enough for FTX to argue that the parents “knew or should have known”.
On the contrary, FTX should have provided specific facts demonstrating the “actual knowledge” of the fact that the parents “knew that certain actions would result in a breach of fiduciary duty”.
This court deposit refers to the September 2023 report made by FTX, which alleges that the two parents transferred funds fraudulently.
Sam Bankman-Fried and the complaint against parents by FTX
The bankrupt crypto-exchange, in its endeavor to recover the fraudulently used funds, has also reported SBF’s parents.
Actually, the complaint does not mention total figures, but it provides details according to which Bankman received an annual salary of $200,000 for his role as senior consultant of the FTX foundation.
Not only that, there would also be over 18 million dollars for the property in the Bahamas and 5.5 million dollars in donations from the FTX Group to Stanford University, which the University has stated will be returned.
The current response and request from the two parents of SBF comes after two months since their son was convicted.
SBF guilty of all charges of high-risk fraud
It was November 2023, when Sam Bankman-Fried was declared guilty by the jury in the trial, on all charges of high-risk fraud.
The verdict came just one year after the collapse of the crypto-exchange FTX, of which SBF was the CEO. This collapse had devastating consequences both for its clients and for the entire crypto sector, as it marked the beginning of the “crypto winter” period.
Anyway, the charges against SBF included seven counts of telematic fraud, securities fraud, and money laundering. All the charges against him stem from the alleged scam against FTX customers, as well as the lenders associated with Alameda Research.
According to Damian Williams, the United States Attorney for the Southern District of New York, Sam Bankman-Fried’s actions have been described as “one of the largest financials in American history.”
