FTX opposes new bankruptcy investigation as it probes Bankman-Fried connections
Last updated on: 27 January,2023 08:30 am
FTX opposes new bankruptcy investigation as it probes Bankman-Fried connections
ZURICH/LONDON (Reuters) - FTX has objected to a U.S. Department of Justice request for an independent investigation into the once-prominent crypto exchange s collapse, saying it is already conducting a wide-ranging probe that includes family members of FTX founder Sam Bankman-Fried.
FTX said in a court filing in Wilmington, Delaware, late on Wednesday that the DOJ s proposed review would only add cost and delay to its bankruptcy case. FTX acknowledged "fraud, dishonesty, incompetence, misconduct, mismanagement, and irregularity" in its past conduct, but said that its previous wrongdoing is already being probed by the company s new management, its creditors and law enforcement agencies.
As part of its own investigation, FTX asked US. Bankruptcy Judge John Dorsey, who is overseeing its Chapter 11 proceedings, to help it secure documents from Bankman-Fried, members of his family and other insiders with information about FTX transactions that used "misappropriated and stolen" funds. These transactions, it said, include a $16.7 million Bahamian real estate purchase under the name of Bankman-Fried s parents, Joseph Bankman and Barbara Fried.
FTX is also seeking information about political donations connected to Bankman-Fried, asking wide-ranging questions about Mind the Gap, a political action committee founded by Barbara Fried, and Guarding Against Pandemics, an advocacy organization founded by Sam Bankman-Fried and his brother, Gabriel Bankman-Fried. FTX said Guarding Against Pandemics multimillion-dollar Washington, D.C., headquarters was purchased with misappropriated funds. Bankman-Fried and members of his family could not immediately be reached for comment.
A spokesperson for Mind the Gap said it did not receive direct contributions from Sam Bankman-Fried, although Bankman-Fried made donations to some political causes it recommended to its donor network.
FTX, once among the world s top crypto exchanges, shook the sector in November by filing for bankruptcy, leaving an estimated 9 million customers and other investors facing total losses in the billions of dollars.