- Stanford University had received over $5.5 million in donations from FTX
- The donation came through Sam Bankman-Fried’s father, Joseph Bankman
- Stanford has agreed to return the funds
YEREVAN (CoinChapter.com) — Stanford University has announced it will return over $5.5 million it received in donations from the FTX Group. According to allegations labeled against the California-based institution, the funds were funneled to them by FTX founder Sam Bankman-Fried’s father, Joseph Bankman. He has been a faculty member at Stanford since 1989.
The developments come amid the recent legal action taken by FTX debtors against Sam Bankman-Fried’s parents.
The Stanford University, in a statement provided to the media, confirmed the receipt of these donations. The statement committed to returning the entire sum to the debtors.
“Stanford received gifts from the FTX Foundation and related companies largely for pandemic-related prevention and research. We have been in discussions with attorneys for the FTX debtors to recover these gifts and we will be returning the funds in their entirety,”the statement read.
FTX Debtors sue Sam Bankman-Fried’s parents
In an interesting development, creditors of the insolvent cryptocurrency exchange FTX have started legal proceedings against Joseph Bankman and Barbara Fried, the parents of Sam Bankman-Fried (SBF).
The lawsuit, filed on Sep. 18, alleges that they unlawfully diverted millions of dollars by participating in the exchange’s operations.
The plaintiffs claimed that the duo leveraged their access and authority within the FTX enterprise to enhance their wealth at the expense of debtors.
These plaintiffs further assert that SBF’s parents played an active role in the exchange from its inception until its collapse. Their son, however, had denied their involvement.
Notably, SBF’s father, a tax attorney, held a senior advisory role with the FTX Foundation, the philanthropic arm of the former American crypto exchange. His employment included a base salary of $200,000 and the potential for a “discretionary bonus”.
Stanford University benefited at the expense of FTX creditors
The lawsuit alleges that Sam Bankman-Fried‘s father played a leading role in redirecting $5.5 million in funds to Stanford between November 2021 and May 2022.
“Bankman owed a fiduciary duty to FTX Trading, Alameda, Alameda Ltd., and FTX US, and each of their subsidiaries and affiliate. Bankman’s repeated efforts to direct funds from the FTX Group to Stanford University constitutes a flagrant breach of those duties, as they effectively enriched Bankman’s employer (Stanford University) at the expense of the FTX Group,”the lawsuit claims.
Meanwhile, the legal team of Joseph Bankman and Barbara Fried has called FTX’s accusations “completely false.”