In May, the founder of a Chicago nonprofit that works with recently incarcerated people got an email from the father of Sam Bankman-Fried, offering to make a donation on behalf of his son’s cryptocurrency exchange.
Soon after FTX pledged to give the nonprofit $600,000, a consulting firm hired by the exchange blasted the news to members of prominent think tanks, urging them to praise the program publicly on Twitter. At least two email recipients did so.
The money never made its way to the nonprofit, called Equity and Transformation. But the pledge — and its attendant publicity — provides a glimpse into the inner workings of the sprawling influence campaign that Mr. Bankman-Fried shaped before it all came to a halt this month when his company was forced to file for bankruptcy, prompting a criminal investigation…
Even as Mr. Bankman-Fried focused on politicians and regulators, his father, Joseph Bankman, appeared to be more involved in promoting his son’s ideas for charity and social change.
In addition to connecting with Equity and Transformation, the Chicago nonprofit, Mr. Bankman identified programs designed to increase financial inclusion and close the racial wealth gap that he thought Mr. Bankman-Fried should donate to.
Mr. Bankman, a professor at Stanford Law School, also sought to connect his son with his friends in academia whose research focused on racial equality and financial inclusion. Mr. Bankman hoped his colleagues would support his beliefs that cryptocurrencies could help equalize access to the financial system.
“I did reach out to others who share my interest in financial inclusion to explore the role that crypto might play,” Mr. Bankman said in a phone interview on Monday.
On Nov. 11, the day FTX filed for bankruptcy, Mr. Bankman wrote to Richard Wallace, the executive director of the Chicago nonprofit, to express his sadness that the $600,000 donation wouldn’t come through. The staff of the FTX Foundation, the exchange’s philanthropic arm, had resigned and its funds had evaporated.
The donation, which had been promised in June and would have paid for a guaranteed income program for recently incarcerated people and their families, was set to begin Thursday.
“I’m heartbroken, as you can imagine, about what’s happening and heartbroken about the loss of our project,” Mr. Bankman wrote to Mr. Wallace. He said he would have funded half the project out of his own pocket had the FTX Foundation been able to put in the other half. Funding the entire $600,000 by himself was out of the question, Mr. Bankman added.
“I’ll be spending substantially all of my resources on Sam’s defense.”
Before the company collapsed, FTX staffers frequented Island Brothers, an upscale French bistro a stone’s throw from the company’s headquarters, restaurant employees said. The owner got to know Mr. Bankman-Fried’s father, Stanford tax-law scholar Joseph Bankman, during his visits to Nassau to spend time with his son.
Last week, FTX’s downfall brought Mr. Bankman to Island Brothers in a somber mood. After a few pleasantries, the restaurant owner said, Mr. Bankman broke down in tears.
Disgraced FTX boss Sam Bankman-Fried looks distressed as he is seen for the FIRST time since collapse of his $32billion crypto empire at his $40M penthouse hideaway in the Bahamas
* His parents Barbara and Joseph Bankman were also spotted on the terrace at separate times, with his father pacing up and down while talking animatedly into his phone and gesticulating with his hands
* The apartment has also been a base for the disgraced former CEO’s parents, both law professors at prestigious Stanford University.
And it would appear they are also shouldering the burden of their son’s current predicament.
Bankman-Fried’s FTX snapped up 19 properties worth $121million before his crypto empire fell, including a $16million vacation home for his parents.
Ray was appointed CEO on November 11, after the company was near collapse and its previous management sought legal counsel on what to do next. Bankman-Fried was persuaded to give up control of the company by his lawyers as well as his father, Joseph Bankman, a professor at Stanford Law School, according to Thursday’s filing.