The mother and father of Sam Bankman-Fried, the disgraced founding father of FTX, are searching for to have the lawsuit filed in opposition to them dismissed. They’re arguing that that they had no involvement in any alleged fraudulent transfers or breaches of fiduciary duties.
Attorneys representing Joseph Bankman and Barbara Fried filed a motion on Monday, stating that the plaintiffs, who’re debtors of FTX and Alameda Analysis, are trying to use the truth that Bankman-Fried is their son.
The attorneys representing Bankman and Fried emphasised that their relationship with the debtor entities shouldn’t be grounds for authorized motion.
They identified that neither defendant held any govt roles and had solely restricted interactions with the Debtor entities.
The lawsuit was initially filed by FTX in September 2023, searching for to get better damages attributable to alleged fraudulent transfers, breaches of fiduciary duties, and different misconduct.
In line with the plaintiffs, Bankman and Fried used their entry and affect throughout the FTX enterprise to counterpoint themselves on the expense of the debtors.
They claimed that Bankman described Alameda as a “household enterprise” and used funds offered by the debtors to buy a luxurious property in The Bahamas generally known as “Blue Water” or “Previous Fort Bay” price $16.4 million.
Sam Bankman-Fried Dad and mom Deny Allegations
Bankman and Fried have vehemently denied these allegations.
They argued that Bankman’s familial relationship and communications with Bankman-Fried didn’t make Bankman a de facto director of Alameda or FTX US.
The attorneys emphasised that the lawsuit failed to ascertain that Blue Water was their main or unique residence and identified that many FTX Group operations and enterprise properties had been positioned within the Bahamas on the related time.
The lawsuit additionally claimed that Bankman and Fried pushed for substantial political and charitable contributions, together with donations to Stanford College, in an try to reinforce their skilled and social standing on the expense of the FTX Group.
In response, the mother and father’ legal professionals dismissed this allegation as legally insignificant, noting that the lawsuit didn’t set up that Bankman or Fried personally benefited from the donations.
New FTX Administration Seeks Capital
In the meantime, FTX’s new administration has been making an attempt to reclaim funds disbursed previous to its Chapter 11 submitting in November of the earlier yr.
For one, the corporate has initiated authorized motion in opposition to Kives and his enterprise capital agency, K5, to recover the estimated $700 million Bankman-Fried had invested in it.
The grievance claims that Bankman-Fried was a “profligate patron” who despatched thousands and thousands to Kives, K5 International, and Baum after he attended a social occasion hosted by Kives in 2022.
Extra just lately, FTX’s chapter advisers filed a lawsuit in opposition to Bybit Fintech to get better $953 million price of money and digital property that had been withdrawn from the trade previous to its Chapter 11 submitting a yr in the past.
As reported, US prosecutors have determined not to pursue the remaining charges in opposition to Sam Bankman-Fried, together with allegations of international bribery and financial institution fraud.
Nonetheless, the dropped cost of illegal political donations has sparked important concern throughout the crypto group, given Bankman-Fried’s well-documented contributions to politicians from each main events.
Prosecutors had claimed that Bankman-Fried used buyer funds to the tune of $100 million for political donations.