FTX Foundation under Scrutiny as Bankruptcy Team Pursues $71M Recovery

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FTX and its affiliated hedge fund firm Alameda Research
are planning to recover USD $71 million spent by the bankrupt cryptocurrency
exchange on philanthropy. The lawyers representing the companies also plan to
recover funds from FTX Foundation.</p><p>Filed before a US
<a href="https://www.financemagnates.com/terms/b/bankruptcy/">bankruptcy</a> court in Delaware, FTX's lawyers have accused several life sciences
companies, including Lumen Bioscience Inc., Greenlight Biosciences Holdings, and Platform
Life Sciences Inc., of allegedly receiving funds from the collapsed exchange.</p><p>Alleged Misappropriation
of Funds</p><p>The attorneys added that
although the funds were purported to promote effective altruism, a philosophy
supporting the transfer of resources from wealthy people to the poor, FTX made
the donations so that Sam Bankman-Fried, the exchange's former CEO, could gain
political influence and goodwill. The donations were made in collaboration with
Latona Biosciences Group, a purported non-profit organization based in the
Bahamas, the filing noted.</p><p>"Together, the FTX
Foundation and Latona took more than USD $71 million of the commingled funds from
Alameda and FTX accounts to make investments and donations to life sciences
companies for Bankman-Fried's personal aggrandizement," the filed document
stated. </p><p>In a separate <a href="https://storage.courtlistener.com/recap/gov.uscourts.deb.188450/gov.uscourts.deb.188450.1562.0.pdf" target="_blank" rel="follow">document</a> submitted to the bankruptcy court, the New
York-based Metropolitan Museum of Art said it had decided to return USD $550,000
donated by Sam Bankman-Fried before the collapse of the exchange.</p><p>FTX Intensifies Recovery
Efforts</p><p>The development is the
latest in the efforts to recover funds allegedly misappropriated by the former
executives of FTX. A week ago, <a href="https://www.financemagnates.com/" target="_blank" rel="follow">Finance Magnates</a> reported that FTX's bankruptcy
lawyers were <a href="https://www.financemagnates.com/cryptocurrency/ftx-seeks-to-recover-300m-paid-to-the-leadership-of-its-european-affiliate/" target="_blank" rel="follow">planning
to recover</a> USD $323
million paid to the leadership of FTX Europe, a European subsidiary of the crypto exchange.</p><p>The money was reportedly
paid by Bankman-Fried for the <a href="https://www.financemagnates.com/terms/a/acquisition/">acquisition</a> of DAAG, a Swiss company that was
later renamed FTX Europe. On top of that, FTX Europe's leadership is believed
to have received USD $100 million for the acquisition of K-DNA, an entity that
was later integrated into the company for 2 million euros.</p><p>In
June, FTX released a report showing that USD $7 billion out of an estimated USD $8.7 billion
owed to FTX's customers <a href="https://www.financemagnates.com/cryptocurrency/ftx-bankruptcy-team-releases-second-investigative-report-7b-recovered/" target="_blank" rel="follow">had
been recovered</a>. According to
an investigation done by the exchange's bankruptcy team, the alleged
commingling of funds by FTX's former executive team complicated efforts to
recover the missing money.</p>

This article was written by Jared Kirui at www.financemagnates.com.