Sam Bankman-Fried, a co-founder of FTX, received more than $2bn (£1.7bn) from entities linked to the collapsed cryptocurrency exchange into his personal accounts, according to court filings.
Bankman-Fried and five members of his inner circle transferred a total of $3.2bn into their personal accounts through “payments and loans”, according to US bankruptcy court filings in Delaware made by FTX’s new management.
FTX was once worth as much as $40bn but rapidly collapsed in November after a surge in customer withdrawals as rival exchange Binance reversed a plan to bail out its competitor. FTX admitted it did not have sufficient assets in reserve to meet the sudden increase in customer demand.
The collapse sent shockwaves through the digital asset industry in what has been described as a “crypto winter” and a “Lehman Brothers moment” for the sector.
Bankman-Fried, who was the poster boy for the crypto industry, now faces 12 federal charges and is awaiting trial after pleading not guilty to a fraud while running FTX. He has been accused of securities fraud and extracting funds from the platform for personal gain.
The transferred funds, which included $2.2bn received by Bankman-Fried, mainly came from Alameda Research, a crypto-trading hedge fund affiliated with FTX.
Three FTX insiders – Gary Wang, Nishad Singh and Caroline Ellison – were transferred a total of more than $800m. They have pleaded guilt and are cooperating with prosecutors.
Ellison, the former head of Alameda who received $6m, has said that hedge fund had “an unlimited line of credit on FTX.com” from 2019 to 2022.
FTX, now led by a new chief executive, John Ray, said the $3.2bn did not include $240m in “political and charitable donations”, “luxury property in the Bahamas” and “substantial transfers”, the Financial Times reported.
Ray is leading efforts to recover cryptocurrency and other assets to return to millions of FTX customers who are expected to lose funds because of the bankruptcy. Their accounts have been frozen since its collapse.
The company has also asked for the return of hundreds of millions of dollars in political donations that were made to celebrities, charities and Republican and Democratic politicians.
Bankman-Fried is detained at his parents’ home in California until the trial begins – expected to be in October.
A lawyer for Bankman-Fried has been contacted for comment.
