Stanford University is taking steps to return millions of dollars in donations it received from the now-bankrupt cryptocurrency exchange FTX and associated entities, according to a report by Bloomberg.
A spokesperson from the University told Bloomberg that Stanford has been engaged in discussions with FTX’s attorneys to facilitate the return of these donations. The spokesperson stated,;
“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.”
This development follows a recent lawsuit filed by FTX Debtors against former FTX CEO Sam Bankman-Fried’s parents, seeking the recovery of allegedly misappropriated millions of dollars. The debtors alleged that Allan Joseph Bankman and Barbara Fried, both tenured professors at Stanford, used their influence not only to enrich themselves but also to coax FTX to make gifts to the University to enhance their social standing.
According to court documents, the Debtors assert that “Bankman’s repeated efforts to direct funds from the FTX Group to Stanford University constitute a flagrant breach of those duties, as they effectively enriched Bankman’s employer (Stanford University) at the expense of the FTX Group.”
It is alleged that Stanford received gifts totaling approximately $5.5 million from FTX-related entities between November 2021 and May 2022. However, the Stanford spokesperson clarified that these gifts and donations were primarily intended for pandemic-related prevention and research.
In response to the allegations, the legal representatives of Joseph Bankman and Barbara Fried issued a statement calling FTX’s claims of fraudulent transfers “completely false.” They characterized the lawsuit as an attempt to intimidate their clients just days before their child’s trial began.
While the lawyers vehemently denied the allegations, they refrained from making any further comments regarding the University’s statement.
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