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With many media outlets confirming that FTX founder Sam Bankman-Fried (SBF) lost all of his wealth when the trading platform he co-founded filed for bankruptcy last year, questions now arise as to how the 31-year-old is funding the rising cost of retaining the attorneys representing him. In a recent report by Forbes, these funds seem to be from early donations he made to his father Joseph Bankman.
Among the many accusations being levied against SBF is the misappropriation of customers' funds. While still the CEO of the company back in 2021, sources close to the company said he made donations through Alameda Research to his father. This sum might allegedly be up to $11.7 million.
This fund, per sources close to the matter, was sent to Bankman as a gift through SBF's lifetime estate and gift tax exemption — essentially a tax-free gift. By law, this gift permits SBF to donate all possible funds in his lifetime, which amounts to the figure quoted.
SBF is being represented by Mark Cohen and Christian Everdell of Cohen & Gresser, as well as David W. Mills, a close family friend from Stanford University, per Forbes sources. Mills' services are being offered pro bono.
How big are SBF's legal liabilities?
While there are no exact figures, the Forbes report noted that the amount of legal liability comes down to single-digit millions.
SBF's father is a clinical psychologist at Stanford, while his mother is a retired professor from the same university. It remains unknown how they could afford the legal fees after wagering their Palo Alto home worth $1.8 million as part of the $250 million bail bond paid on Sam last year.
The Forbes report is one of many revelations that shows SBF's true worth may be more than the $100,000 he claimed to have left to his name recently.
Vladislav Sopov