Former billionaire and founder of bankrupt exchange FTX Sam Bankman-Fried dolled out millions for access to the world’s most powerful people. And now the estate wants those millions back.
According to a filing with the United States Bankruptcy Court for the District of Delaware, Sam Bankman-Fried promised billions of dollars to Michael Kives and Bryan Baum of K5 Global. Following a dinner party at Kives’ residence, the duo and Bankman-Fried entered into a hasty financial relationship that culminated in Baum and Kives, and related entities, being transferred about $700 million. Much of the payments were sent to shell companies controlled by the defendants.
Baum also had a room reserved for him in one of the luxury Bahamian apartments Bankman-Fried had purchased.
Flush with cash
FTX and Bankman-Fried were known for their flush with cash spending across the sport, art, and the political realm. A supporter of so-called effective altruism, Bankman-Fried said he planned to donate the vast majority of his wealth to charitable causes. Of course, that was before his exchange blew up and he was accused of fraud and misappropriating client funds.
The filing alleges that Bankman-Fried saw Baum and Kives as one way to expand his influence among celebrities and political glitterati.
In an internal note, Bankman-Fried said that Baum and Kives could provide “infinite connections” as well as “potential unpaid partnerships with celebrities.” He added that they also wanted to provide FTX with contacts for the firm to “work with them on Democratic politics.”
In recent days, the estate has been the subject of scrutiny over the fees and expenses it is paying to lawyers and financial advisors as it attempts to recover assets for creditors. The Block Research team found FTX paid over $120 million in advisor fees between February 1 and April 30.
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