• FTX and Alameda Research are seeking to recover more than $71 million that was allegedly diverted from the FTX Foundation and Latona.
• The funds were transferred to life science companies, purportedly to support “effective altruism”.
• However, FTX’s lawyers claim that the true intention behind these transactions was far from philanthropic.
FTX Seeks to Recover $71 Million
Crypto exchange FTX and its sister company Alameda Research are seeking clawbacks from FTX’s philanthropic arm and other life science entities for more than $71 million that was allegedly diverted from the FTX Foundation and a “sham non-profit company organized in the Bahamas” for ex-FTX boss Sam Bankman Fried (SBF)’s personal aggrandizement.
Life Science Companies Targeted
The firms are targeting life science companies including Lumen Bioscience Inc., Platform Life Sciences Inc., GreenLight Biosciences Holdings, PBC, Riboscience, Genetic Networks, 4J Therapeutics, Latona Biosciences and SBF himself for the recovery of these funds. These transfers were purportedly meant to support “effective altruism” – a philosophy often espoused by SBF before his empire came crashing down which advocates for the redistribution of wealth from wealthy individuals to those in need.
True Intentions Unveiled
However, according to court documents filed by lawyers representing FTX and Alameda Research on Wednesday it is argued that the true intention behind these transactions was far from philanthropic with Bankman-Fried in fact pursuing them because he believed that doing so would generate goodwill and amass political capital and influence for himself. Private messages revealed at the time also indicated that much of what Bankman-Fried had done prior to his exchange’s exposure was a “front” or facade used as part of this effort.
Democratic Party Refuses Refund
When Bankman-Fried’s empire came crashing down in February this year, the United States Democratic Party only agreed to return ~3% of donations it had received from him prior – rejecting any further refunds or compensation.
With no explicit benefit received by either firm (equity shares etc.), FTX seeks through avoidance of transfers now to recover funds they allege have been inappropriately misused by those involved – namely Bankman-Fried himself as well as Ross Rheingans-Yoo who headed Latona – in pursuit of personal gain rather than altruistic intent as originally claimed.