Bankman-Fried’s parents scrutinised over court antics as FTX confirms they ‘received payments’
The actions of disgraced FTX founder Sam Bankman-Fried’s law professor parents are under heavy scrutiny as he sits in a rat-infested prison.
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The actions of disgraced FTX founder Sam Bankman-Fried’s law professor parents are under heavy scrutiny this week following the former billionaire’s arrest on an array of federal charges.
Joseph Bankman and Barbara Fried, both professors at Stanford University, raised eyebrows on Tuesday with their behaviour at their son’s extradition hearing in the Bahamas.
About 1,000 miles away on Capitol Hill, new FTX CEO John Ray revealed during bombshell testimony that he was “investigating” the parents’ role in FTX’s downfall.
Bankman, who received payments from FTX and was heavily involved in the doomed platform’s operations, was seen sporadically plugging his ears during the hearing “as if to drown out the sound of the proceedings,” CoinDesk reported.
Fried appeared disdainful of the court’s characterisation of Bankman-Fried as a “fugitive” and “audibly laughed several times,” according to the report.
The embattled parents reportedly sat in the third row and “appeared to oscillate between dejection and defiance” during the hearing, which culminated in a judge denying Bankman-Fried’s request for $250,000 in cash bail. He will remain in a hellish Bahamas jail until his next hearing on February 8.
During his testimony before the House Financial Services Committee, Ray confirmed that Bankman had given “legal advice” to his son at FTX and received cash payments from the company.
“I don’t know if he actually had ‘employee’ status, but he certainly received payments, the family did receive payments,” Ray said.
The Post has reached out to a spokesperson for Bankman and Fried for comment.
Rep. Bill Huizenga (R-Mich.), who had questioned Ray about the crypto kid’s parents — both of whom have strong ties to Democrats — noted that Bankman-Fried was “at least 15 minutes late” to a meeting at his office in December 2021 and that “his father accompanied him” on the visit.
“It seems to me that there’s a lot more to uncover here. Certainly, Mr. Bankman-Fried has, let’s say, ‘wooed many’ in New York, Silicon Valley, around the world and yes, certainly here in DC,” Huizenga said.
Property records obtained by Reuters showed FTX had purchased a $16.4 million luxury beachfront property for the parents that was meant as a “vacation home.”
“I know it was not intended to be their long-term property. It was intended to be the company’s property. I don’t know how that was papered in,” Bankman-Fried claimed last month.
Bankman, who helped craft Massachusetts Sen. Elizabeth Warren’s failed legislation to simplify the tax code in 2016, regularly accompanied his son to meetings on Capitol Hill during FTX’s rise to prominence in the cryptocurrency sector. He also played an active role in guiding the company’s philanthropic efforts and even introduced his son to an influential investor, Orlando Bravo.
While Fried was not a paid employee of FTX, she was closely tied to her son’s donations of tens of millions of dollars to Democrats ahead of the 2022 midterm elections. The ex-billionaire contributed to a political advocacy network that Fried oversaw.
The parents’ involvement with FTX has also impacted their standing at Stanford, where they have become a “subject of gossip” among colleagues, according to the New York Times.
“I had a friend who said, ‘You don’t want to be seen with them,’” Larry Kramer, a former dean at Stanford’s law school and a family friend, told the outlet. “I don’t see how this doesn’t bankrupt them.”
Bankman and Fried “have told friends that their son’s legal bills will likely wipe them out financially,” the Wall Street Journal reported earlier this week.
Bankman-Fried’s Bahamas jail infested by rats and maggots: ‘Not fit for humanity’
Bankman-Fried is being held in a Bahamian jail known to be overrun with rats and maggots — one so bad that a warden has called it “not fit for humanity.”
The accused fraudster, once estimated to be worth $32 billion, is being held in the island’s only correctional facility, Fox Hill Prison, until at least Feb. 8 after failing to get bail while fighting against extradition to the US.
The jail was the focus of a damning report last year by the US Department of State into possible human rights violations, including violence and abuse by staff.
“Inmates removed human waste by bucket,” the government report noted of the jail where often six inmates are crammed into tiny cells that are only 6 feet by 10 feet.
“Some inmates developed bedsores from lying on bare ground,” the report said of “harsh” conditions from “overcrowding, poor nutrition, inadequate sanitation, and inadequate medical care.”
“Sanitation was a general problem, and cells were infested with rats, maggots, and insects,” the State Department noted.
The Nassau Guardian newspaper said it saw the rodents first-hand during a 2019 tour, with a prison guard confirming “that rats run up and down all day, every day.”
“Dogs don’t deserve to live in the state that maximum security is in,” the officer told the paper on the condition of anonymity.
“Boy, you don’t even know. … It’s not fit for humanity,” the warden said.
Fox Hill Prison is so bad, in fact, some inmates have begged to be extradited to the US just to escape it.
In 2019, a pastor waived his right to fight extradition to Georgia — where he was ultimately sentenced to life in prison for rape and child molestation — because he feared being killed by gangs in the brutal Bahamian jail.
“Fox Hill ain’t no place for nobody to stay in … I am ready to go,” rapist Don Martin told the magistrate who approved his extradition, the Tribune reported at the time.
Many believe Bankman-Fried — who signalled he plans to fight extradition — should do the same, even though he faces a maximum of 115 years in prison if convicted of all eight federal charges he faces.
“There is no advantage to him staying, he’ll be sent to the US eventually anyway,” said Larry Levine, founder of Wall Street Prison Consultants, which advises those convicted of white-collar crimes on how to get into better prisons.
Bahamian Commissioner of Correctional Services Doan Cleare claimed that the hideous conditions have been improved by renovations, saying “we don’t have any issues with rodents.”
He said the disgraced 30-year-old FTX mogul will start his stay in the medical department in a sick bay that can hold about five people.
“He will be in sick bay for orientation purposes and then we will determine where best to place him,” Cleare said Tuesday.
Either way, it will be a stunning change of scenery for the former crypto wunderkind, who lived and worked in extravagant luxury in the Bahamas before his arrest late Monday.
This article was originally published by the New York Post and reproduced with permission
Originally published as Bankman-Fried’s parents scrutinised over court antics as FTX confirms they ‘received payments’
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