FTX’s new management has uncovered $3.2 billion in transfers to the company’s founders.
Much of that money — $2.2 billion — went to former FTX chief executive and accused fraudster Sam Bankman-Fried, the cryptocurrency company’s new management said in a news release Wednesday (March 15) evening.
The transfers were described as “payments and loans,” the release said, primarily coming from the hedge fund Alameda Research, FTX’s sister firm.
The figure does not include $240 million “spent to purchase luxury property in the Bahamas, political and charitable donations made directly by the FTX Debtors, and substantial transfers to non-Debtor subsidiaries in the Bahamas and other jurisdictions,” per the release.
As PYMNTS has reported, recent court filings have shown what John J. Ray III, FTX’s current CEO, has called a “massive shortfall” of “highly commingled assets” at the company. representing more than $8.6 billion in total liabilities.
The bankruptcy presentation says that “related party payables and receivables” include $9.3 billion of net borrowing by Alameda from FTX.com.
In total, more than $2.15 billion in assets were found at FTX.com, and another $191 million was collected at FTX.US, versus a total deficit of $8.69 billion.
“Both exchanges generally held digital assets in sweep wallets which were not segregated for individual customers,” the report stated.
Among the other former FTX principals received the “payments and loans” were former engineering director Nishad Singh ($587 million), co-founder Gary Wang ($246 million) and Alameda Research CEO Caroline Ellison ($6 million).
All three have pleaded guilty and are cooperating with authorities in their case against Bankman-Fried, who is accused of using FTX to mastermind a multi-billion fraud that has shaken the cryptocurrency world.
The 31-year-old one-time crypto-wunderkind is set to go to trial in October, facing an array of charges, including wire fraud, bank fraud, conspiracy and campaign finance violations stemming from an alleged use of “straw donors” that allowed him to evade contribute limits.
Bankman-Fried, who had pleaded not guilty and repeatedly denied any wrongdoing, is free on bail. However, his freedom has been in question lately as the judge in his criminal case grapples with the terms of his bail and his access to communication devices.
This latest piece of FTX news comes amid an already volatile time for the crypto world, following the collapse of two banks that had courted clients in the sector, and the ongoing struggles at Binance, the industry’s biggest player.