FTX victims go after company’s assets from criminal forfeiture
Though Sam Bankman-Fried is currently serving a prison sentence, affected FTX customers and creditors are making claims on the firm’s assets, which are still worth millions.
Different groups have filed competing claims over some or all of the assets at issue in the criminal case against former FTX CEO Sam Bankman-Fried, who is currently serving a 25-year sentence in federal prison.
In a June 14 filing in the United States District Court for the Southern District of New York, lawyers representing the FTX debtors and the firm’s Bahamian entity, FTX Digital Markets, argued that they had a “superior right” to assets that may be used to satisfy the court’s $11-billion judgment against Bankman-Fried. The legal team claimed that FTX’s aircraft, funds held at Signature Bank, Farmington State Bank and Silvergate Bank, the sale of shares of Robinhood stock and political contributions associated with former FTX executives should not be used for Bankman-Fried’s judgment but to benefit victims of the defunct exchange.
“Amending the Preliminary Forfeiture Order to provide for the return the Specific Property to the Debtors and/or FTX Digital will benefit all the creditors and stakeholders in the Debtors’ Chapter 11 bankruptcy proceedings and FTX Digital’s liquidation in The Bahamas, including victims of Bankman-Fried’s crimes,” said the June 14 filing. “Distributing the value of the Specific Property to the more than 1 million victims of BankmanFried’s criminal scheme is no small feat, and doing so through the Debtors’ existing claims administration architecture and processes will maximize the funds available for distribution by minimizing the incremental administrative and professional costs.”
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Author: Turner Wright
