Bankrupt cryptocurrency exchange FTX and its sister company Alameda Research are seeking to reclaim more than $71 million from the exchange’s philanthropic and life science arms.
FTX Philanthropic and Life Science Arms Received $71M
According to court documents filed on July 19, the FTX Foundation and Sam Bankman-Fried’s (SBF) Latona life sciences fund received roughly $71.5 million from FTX and Alameda Research between February and October 2022.
Specifically, the donations were made to the life sciences arm of several companies, including Lumen Bioscience, GreenLight Biosciences, Genetic Networks, and 4J Therapeutics.
To reclaim the money, lawyers representing FTX argued that the donations were made for SBF’s “personal aggrandizement.”
“The FTX Foundation was the philanthropic arm of the FTX group of companies, and Latona was a sham non-profit company organized in the Bahamas. Together, the FTX Foundation and Latona took over $71 million of commingled funds from Alameda and FTX accounts to make investments in and donations to life sciences companies for Bankman-Fried’s personal aggrandizement,” court documents stated.
The lawyers stated that while claiming to make these investments for charitable purposes such as pandemic prevention and preparedness, SBF, in reality, pursued these transactions to “generate goodwill and amass political capital and influence for himself.”
Recovering Customers’ Funds
Meanwhile, the latest filing is the latest step taken by FTX’s new management to recover funds for its customers. Last month, the management sued a former aide to Hillary Clinton and the former aide’s investment firm, seeking to retrieve eye-watering $700 million in investments made with misused customer’s funds. According to the FTX management, SBF authorized the fund transfer to Michael Kives’ K5 entities in 2022 before the exchange went bankrupt.
Lawyers are also seeking to recover $550,000 in donations made by FTX’s U.S. entity West Realm Shires Services, to New York’s Metropolitan Museum of Art.
In a recent investigative report, FTX management stated that they had recovered approximately $7 billion in liquid assets. The exchange owed customers around $8.7 billion worth of assets when it filed for bankruptcy last November.
