Good day everyone,
I hope you are all well and having excellent day, welcome to CryptoGod-1’s blog on all things crypto. In this post I will be looking at how Stanford University are working on returning the entirety of the gifts received from bankrupt crypto exchange FTX.
Gifts and Donations of $5.5 million
Stanford University is currently in discussions with the attorneys of the cryptocurrency exchange FTX with the aim of returning the “entirety” of gifts that it received from the exchange and any related entities. With the parents of the exchanges founder, Sam Bankman-Fried, were hit with a lawsuit regarding their exploitation of influence to enrich themselves directly and indirectly by millions of dollars, the University have moved swiftly to distance themselves with any association with the exchange.
Both Barbara Fried and Joseph Bankman were tenured as Law School professors at Stanford, and the lawsuit against them states that Bankman channelled around $5.5 million in gifts to Stanford University from November 2021 to May 2022. The attorneys of both Bankman and Fried noted the allegations of FTX’s fraudulent transfers are entirely unfounded and false, while also stating they are a dangerous attempt to intimidate Joe and Barbara while undermining the jury process just days before Sam Bankman-Fried's trial starts.
A spokesperson for the school noted that they received gifts from the FTX Foundation and FTX-related companies for mostly “pandemic-related prevention and research.” They went on to state that they have been in discussions with attorneys for the FTX debtors to recover these gifts, along with returning the funds in their entirety.
Joseph Bankman is noted to have gained attention for his work on “how government might control the use of tax shelters and has testified before Congress and other legislative bodies on tax compliance problems posed by the cash economy.” Fried meanwhile is a three-time winner of the John Bingham Hurlbut Award for Excellence in Teaching, along with having written extensively on questions of distributive justice, in the areas of tax policy, property theory and political theory.
Back in December 2022 after the FTX exchange had gone bankrupt, leading to repercussions felt across the crypto industry, Sam Bankman-Fried is known to have noted in an interview with the New York Times that his weren’t involved in any of the relevant parts of the FTX or Alameda Research Business.
“None of them were involved in FTX balances or risk management or anything like that.”
According to the lawsuit filed on Monday the 18th of September 2023, Joseph Bankman tried to distance himself publicly from the FTX estate and any donations received in the past. Stanford University have noted they understood that Bankman and his family were responsible for the donations and not the exchange itself. One university employee described the FTX Group’s donations as “all of the giving from the Bankman-Frieds.” A $4 million donation from Alameda Research to the university was noted by the university rep as causing some confusion as to whether it should be treated as a gift similar to the others (directly from the family) or as a donation from the company.
With FTX now being ran by CEO John J. Ray III, the allegations from the estate claims that FTX was being run as a “family business” with Sam Bankman-Fried’s parents benefitting to the tune of millions of dollars siphoned from the crypto empire. It was also noted that back in November 2021 Joseph Bankman allegedly directed FTX employees to transfer $500,000 in donations to Stanford. Those funds were taken from Paper Bird, another legal entity controlled by his son Sam. Joseph noted at the time:
“We want Paper Bird to do this because it can use the deduction.”
Barbara Fried and Joseph Bankman
When considering both Barbara Fried and Joseph Bankman and the allegations against them from FTX, it is fascinating to see the level of benefits they got from the exchange.
- Joseph Bankman, according to reports, was given an expense of $1,200 per night for hotels, along with plane tickets and tickets to the Formula 1 Grand Prix in France for a student in Stanford Law School. Joseph is known to have referenced it as a "free trip to France" and the student later became outside council for FTX.
- Joseph Bankman was given an annual salary of $200,000 as an FTX employee. It is noted that he commented “I am no longer getting paid by Stanford, cuz I’m on leave. So you should have me on salary, starting Dec. 1.”
- Joseph Bankman was also known to be complaining as he was of the belief that he should be given a salary of $1,000,000 per annum and that he whined to his son about this. If paid that amount, he would have been getting more than $80,000 a month before taxes.
- Sam Bankman-Fried gave both of his parents a combined $10 million in funds which are known to have originating from Alameda Ltd. They were also given $16.4 million worth of property in The Bahamas which was paid for with funds from FTX Trading. Banking is known to have emailed Ryan Salame stating “We are hoping you can all come to celebrate the house you helped us buy/move into . . .”
- Furnishings of their residence was also paid for by FTX, which included eight vases, five rugs, and a Persian hand-knotted rug costing more than $2,500.
- FTX also paid $90,000 for a variety of expenses on Bankman and Fried's property, including cleaning and landscaping.
- Joseph Bankman played a cameo role in the FTX commercial by his own request in order to meet Larry David. He is known to have written “OK, I’m not a star-fucker and don’t really care about meeting, say, Tom Brady. But Larry David. . .”
- Barbara Fried is known to have sought donations for her political group, Mind the Gap, while also trying to hide the source of the funds. The filing alleges that she knowingly aided and abetted Bankman-Fried’s, Singh’s, and potentially other FTX Insiders’ breaches of fiduciary duties in connection with these offenses, including Singh’s $1 million contribution to MTG in April 2021 originating from Alameda.
Have a great day.
Peace. CryptoGod-1.
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