Sam Bankman-Fried is paying for legal defense using previously gifted funds from Alameda: Report

The former FTX CEO reportedly gave Joseph Bankman roughly $10 million funded by a loan from Alameda Research as a part of a lifetime estate and gift tax exemption.

Former FTX chief executive officer Sam Bankman-Fried, also known as SBF, is reportedly funding the legal team defending him against federal charges with millions of dollars he gifted his father from Alameda Research.

According to a March 29 Forbes report citing sources with “operational knowledge” of FTX and Alameda, in 2021 Bankman-Fried gave his father at least $10 million that was funded by a loan from Alameda. The former FTX CEO sent the funds to his father, Joseph Bankman — a Stanford Law professor who has stopped teaching classes amid his son’s legal troubles — as part of a lifetime estate and gift tax exemption.

Sam Bankman-Fried’s Legal Defense Is Being Funded With Alameda Money He Gifted His Fatherhttps://t.co/7o21VwaE2n by @SarahNEmerson, @Steven_Ehrlich pic.twitter.com/ttbfa2kjmA

— Forbes (@Forbes) March 29, 2023

Bankman-Fried’s defense team consists of Mark Cohen and Christian Everdell of the law firm Cohen & Gresser, whom the former FTX CEO reportedly retained prior to his extradition to the United States in December. Though SBF remains free on bail at the time of publication, many of his in-person court appearances since his arraignment have focused on potentially restricting these conditions. A judge recently ordered Bankman-Fried be prohibited from using a smartphone with internet access.

Amid the collapse of FTX and Bankman-Fried’s subsequent arrest, members of his family including his father, mother, and close associates have become embroiled in the situation with the crypto exchange. Bankman reportedly retained his own attorney in January, and he and others have been named in potential subpoenas for FTX’s bankruptcy case.

Related: Sam Bankman-Fried petitions court to prioritize reimbursing his legal fees

SBF faced 12 criminal counts following a superseding indictment from federal prosecutors in February, which was amended to 13 on March 28 following allegations he used $40 million to bribe a Chinese government official. Other charges include conspiracy counts related to fraud as well as those for wire fraud and securities fraud. Bankman-Fried entered a not guilty plea in December, with the trial scheduled to begin in October 2023.

Magazine: SBF legal fees, BTC market cap flips Meta and USDC climbs back to $1: Hodler’s Digest, March 12-18