ALL IN THE FAMILY: Sam Bankman-Fried’s esteemed Stanford parents face their own reckoning.
As Joe Bankman and Barbara Fried sat in a Bahamian courtroom Tuesday, the popular Stanford law professors had to be worried about more than whether their FTX founder son, Sam Bankman-Fried, will go to prison for orchestrating what a federal prosecutor described as “one of the biggest financial frauds in American history.”
The couple also have to be concerned about their own legal jeopardy, a criminal law expert said, given reports that they were involved, at some level, in their son’s efforts to build his allegedly fraudulent cryptocurrency exchange into a $32 billion business. They face scrutiny on multiple fronts over whether they were complicit in the alleged crimes that led to the company’s spectacular collapse.
“I can’t imagine a world where Bankman-Fried’s parents were not his financial and legal advisors,” said Matthew Barhoma, a criminal defense and appellate attorney who is based in Los Angeles.
It could get especially ugly for the couple, who are accustomed to a privileged life in high-minded academia. If prosecutors and the FBI want to play hardball, they could try to force Bankman and Fried to cooperate with the investigation and to testify against their beloved son.
“Beloved?” How much money did SBF funnel to the San Jose Mercury?
Meanwhile: Caroline Ellison likely working with feds against Sam Bankman-Fried.
Sam Bankman-Fried’s reported ex-girlfriend was likely among the first people to turn on him and help prosecutors build their fast-moving fraud case in the epic, $8 billion-plus collapse of his FTX cryptocurrency exchange, a former US government lawyer said Wednesday,
Caroline Ellison, 28, is a key figure in the case as she was at one time CEO of the Alameda Research hedge fund — which authorities claim received billions of dollars that Bankman-Fried, 30, diverted from FTX.
“She would have among the greatest incentives to cooperate, as it was seeming likely that in his effort to exculpate himself, Bankman-Fried would try to finger her,” former Securities and Exchange Commission lawyer Howard Fischer told The Post.
Fischer said “the speed of the indictment and the breadth of the charges” against Bankman-Fried meant “someone relatively senior is cooperating with the federal authorities in exchange for leniency for their own potential misconduct.”
“It is possible Bankman-Fried’s publicity tour, in which he repeatedly disclaimed either knowledge of — or responsibility for — mishandling or theft of customer assets, spurred senior officers to fear that he would specifically blame them,” he said.
Finally, America’s Newspaper of Record is now just doing straight-up reportage: DOJ Arrests Sam Bankman-Fried For Running Out Of Bribery Money.