A new lawsuit alleges that a “memo exchanged between Gabriel Bankman-Fried and an officer of the FTX Foundation” focused on buying an island nation and building a bunker there to “ensure that most EAs [effective altruists] survive” any event that kills at least half of humanity.
The memo is but one of the more eye-catching revelations that’s bubbled to the surface in a series of lawsuits filed by the FTX bankruptcy estate, which is seeking to recover hundreds of millions of dollars from the collapse of Sam Bankman-Fried’s crypto empire—money, the estate alleges, that includes fraudulently allocated customer cash.
In its latest claim filed in a Delaware bankruptcy court on Thursday, the FTX estate—led by former Enron bankruptcy steward John Ray—is seeking 48 counts related to the fraudulent transfer of funds by former FTX executives: Bankman-Fried, CTO Gary Wang, head of engineering Nishad Singh, and Alameda CEO Caroline Ellison.
The lawsuit includes previous allegations about how the executives used the windfalls of FTX—including that Bankman-Fried is using customer funds to bankroll his own defense—as well as new claims on its lavish spending.
‘Misguided and sometimes dystopian’
In one, the bankruptcy estate’s lawyers detail how the executives set up a charity called the FTX Foundation “that served little purpose other than to enhance the public stature of Defendants,” alleging that it receives grants directly from bank accounts that contained customer funds.
The lawsuit describes the FTX Foundation’s projects as “frequently misguided and sometimes dystopian,” including a $30,000 grant to an individual to write a book about how to figure out “humans’ utility functions.”
Another $400,000 grant went to an entity that produced animated videos for YouTube about effective altruism, a philosophical movement popular among FTX executives that seeks to maximize social impact through charitable giving and other lifestyle choices.
Before FTX’s collapse, Bankman-Fried was a top donor for political and social causes, often working with his brother, Gabriel Bankman-Fried, a former Democratic staffer and the founder of an advocacy organization called Guardian Against Pandemics.
According to the New York Times, GAP raised more than $22 million in its first year in 2021, with most coming from Sam Bankman-Fried, turning it into an immediate lobbying force. The lawsuit alleges that Sam Bankman-Fried directed at least $35 million to GAP, the majority of which came from Alameda accounts containing commingled customer funds.
‘50%-99.99% of people die’
In the lawsuit, the lawyers cite a memo sent to Gabe Bankman-Fried from the FTX Foundation about buying Nauru, a tiny nation island in Micronesia, with the goal of building a bunker to be used in the event that “50%-99.99% of people die.” The surviving effective altruists would then go on to develop “sensible regulation around human genetic enhancement, and build a lab there.”
“Probably,” the memo also notes, “there are other things it’s useful to do with a sovereign country, too.”
Michael Tremonte, an attorney for Gabe Bankman-Fried, said in an emailed statement that his client took no part in any plans to buy Nauru.
“Gabriel Bankman-Fried did not create, endorse, contribute to, or draft a plan to acquire the island of Nauru,” Tremonte said. “In truth, Gabe received by email a link to the memo, which he did not write or request, and did not forward to anyone else.”
Upcoming trial
The FTX estate is seeking the return of all property that was subject to the fraudulent transfers alleged in the lawsuit, as well as monetary damages, although it did not specify an amount.
Sam Bankman-Fried is awaiting criminal trial in the Southern District of New York, which is expected to begin in October. Gary Wang, Nishad Singh, and Caroline Ellison have all pleaded guilty to criminal charges and are participating with the Justice Department.
Gabe Bankman-Fried has not been accused by prosecutors of any wrongdoing in the collapse of FTX.
(This story has been updated to include comments from representatives of Gabe Bankman-Fried received by Fortune on Oct. 17, 2023. A spokesperson emailed to to say that Gabe didn’t “author” or “request” the memo about buying the island nation of Nauru, in addition to the attorney’s comments included above.)
