#bankman

Consulting with a lawyer who has ties to President Trump. Reaching out to Washington lobbyists. And sitting for a jailhouse interview with Tucker Carlson. Sam Bankman-Fried, the disgraced cryptocurrency mogul who was once a top Democratic donor, has embarked on a long-shot campaign to secure a pardon from the Trump administration, six people with knowledge of the matter said. The effort has been…

FTX Seeks to Recover $700 Million from Sam Bankman Fried's Affiliated Funds

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Source: AdobeStock / Rafael Henrique

Now-defunct cryptocurrency exchange FTX has sued a former aide of Hilary Clinton and the former aide’s investment firm, K5 Global, to retrieve $700 million in funds. 

On Thursday, the company filed a complaint in Wilmington, Delaware, bankruptcy court, asking back the $700 million its founder Sam Bankman-Fried transferred to K5 entities in 2022. 

The lawsuit names K5 Global, Mount Olympus Capital, and SGN Albany Capital, as well as affiliated entities and K5 Global co-owners Michael Kives and Bryan Baum, as defendants.

It claims that Bankman-Fried was a “profligate patron” who sent millions to Kives, K5 Global, and Baum after he attended a social event hosted by Kives in 2022.

“True to Kives’s reputation as a high-profile ‘super-networker,’ the attendees at the dinner party included a former Presidential candidate, top actors and musicians, reality TV stars and multiple billionaires,” the suit said. 

According to the complaint, Bankman-Fried described Kives as “probably, the most connected person I’ve ever met,” and “a one-stop shop” for political relationships and celebrity partnerships.

The suit claimed that while FTX-affiliated crypto trading firm Alameda Research transferred the funds to Kives, Baum, and K5 Global, it did so as coming from shell companies SGN Albany and Mount Olympus Capital.

According to the complaint, a shell company controlled by Sam Bankman-Fried used $214 million in funds from FTX for a questionable investment. The investment involved purchasing a minority stake in Kendall Jenner’s 818 Tequila brand, even though the tequila company’s assets were valued at just $2.94 million based on its filings with the US Securities and Exchange Commission.

FTX has sought the return of funds transferred from Alameda Research that ended up in SGN Albany Capital and funds transferred from Kives, Baum, and SGN Albany Capital to Mount Olympus Capital.

The suit described the transfers as being carried out “without receiving equivalent value” and, more importantly, avoidable, meaning that they can be reversed under the Bankruptcy Code or other laws.

The complaint even claimed that “Kives and Baum worked behind the scenes with Bankman-Fried on a strategy to find someone to bail out the FTX Group (and to protect their golden goose)” after the crypto exchange collapsed.

FTX Costs Increase as Bankruptcy Process Lingers

While FTX is scrambling to retrieve every bit of money it can, the bankrupt crypto exchange is facing escalating legal and advisory costs.

According to filings submitted by the exchange’s bankruptcy advisors, the advisors have billed the company a staggering $121.8 million in fees and expenses for the period between February 1 and April 30.

In another bid to raise funds for users, bankers of FTX are looking to offload their stake in AI startup Anthropic. 

Perella Weinberg, the boutique bank overseeing FTX’s bankruptcy proceedings, is reportedly discussing the potential sale of Anthropic’s stake with interested parties.

FTX ostensibly owned as much as $500 million worth of shares in Anthropic when it filed for bankruptcy last year. However, courtesy of the recent AI boom and rising demand for AI technologies, Anthropic has experienced significant growth as of late.  

Therefore, the sale of the stake is expected to fetch a nine-figure sum, which would be distributed to former FTX customers.

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Sam Bankman Fried’s Empire Started to Crumble Extensive Ahead of the Crypto Crash – Here’s What Transpired

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Resource: a video screenshot, New York Write-up

The crypto empire managed by disgraced FTX founder Sam Bankman-Fried was fragile for many years, with cracks starting to demonstrate up previously in 2022, a new report has suggested.

In accordance to the report, revealed by the Wall Street Journal on New Year’s Eve, Bankman-Fried’s crypto buying and selling firm Alameda Study “never was specifically excellent at investing.”

Alameda “took significant gambles, successful some and getting rid of a good deal,” and a suitable threat administration was lacking, the report said about the buying and selling company, which was recognized for its shut ties – and unrestricted entry – to FTX.

The report contradicts earlier statements from Sam Bankman-Fried, who has insisted Alameda prospered until eventually the crypto crash begun in November of 2021. By that time, Bankman-Fried was currently out as CEO of Alameda, and the organization was jointly led by Caroline Ellison and Sam Trabucco till August 2022, and then by Ellison alone.

Caroline Ellison has apologized for her purpose in the collapse of Alameda and FTX. She has agreed to plead responsible to seven offenses, which involve prices of wire fraud, securities fraud, and revenue laundering.

“Complete lack of chance-administration framework”

In accordance to the Wall Street Journal report, the lack of formal processes and a framework at Alameda was so evident that Austin Campbell, a electronic asset trader at CitiBank, grew skeptical of the company when the financial institution and Alameda was discovering a partnership back again in 2020.

Speaking with the WSJ, Campbell was quoted as declaring:

“The matter that I picked up on promptly that was producing us heartburn was the finish deficiency of a possibility-administration framework that they could articulate in any significant way.”

Japanese arbitrage

As has been commonly documented on, Sam Bankman-Fried and Alameda initially designed its fortune by exploiting an arbitrage chance among crypto prices in Japan and the rest of the globe back again in 2017 and 2018. When that selling price hole closed, however, Alameda experienced to obtain other means to make money.

As reported by the WSJ, Alameda’s investing algorithm was previously at that time shedding revenue, usually earning mistaken bets on price tag moves.

By the spring of 2018, Alameda’s property experienced shrunk by two-thirds, standing at about $30m, the report claimed. It added that “a huge reduction on XRP” was the major explanation for decline in fairness. The procedure then essential ever-more substantial investments from external functions to remain afloat, with Bankman-Fried at one stage featuring creditors returns of up to 20% per year.

Bear marketplace starts

Nonetheless, Alameda continued to operate and make gains for decades, till challenges once again started off to pile up in the direction of the conclusion of the 2021 crypto bull sector.

In late 2021, Alameda begun to pump as a lot as $1bn into crypto miner Genesis Digital Property, which experienced functions in Kazakhstan. The financial commitment was explained as Alameda’s premier venture expenditure “by considerably,” but however it occurred right right before the crypto marketplace began to collapse in 2022.

“The timing was awful: The cost of bitcoin soon collapsed, and with it the income of miners,” the WSJ report stated.

Pursuing the rate crash, defaults started off spreading all through the marketplace, with Bankman-Fried coming to the rescue numerous instances to prop up failing companies.

The troubles compounded when Alameda loan providers begun inquiring for their money back again. And because many of the firm’s investments were being illiquid and not successful, Bankman-Fried noticed only one particular way out he pushed the investing business to borrow billions of pounds from FTX – cash that the trade held on behalf of its customers.

Despite his intense moves to continue to keep the enterprise afloat, it appears Bankman-Fried towards the conclude recognized that Alameda’s business enterprise methods had been not sustainable.

“I imagine it could be time for Alameda Research to shut down. Honestly, it was in all probability time to do that a year back,” he admitted in a doc he confirmed other folks a several months just before the personal bankruptcy, according to the WSJ.

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