The disgraced FTX Founder Sam Bankman-Fried stirred fresh controversy early Friday with an X post. He quotes the creditor advocate My Purple who branded the exchange’s bankruptcy proceedings as “the shadiest” he’s seen.
The message, shared via proxy as Bankman-Fried serves a 25-year sentence for fraud and money laundering, highlighted ongoing creditor frustrations amid partial repayments exceeding $10 billion.
In the post, Bankman-Fried cited a recent Forbes article where pseudonymous advocate “Mr. Purple” – revealed as Kyle, a bankruptcy specialist and DJ – lambasted the process. “FTX is the shadiest bankruptcy I have ever witnessed,” Mr. Purple told Forbes, criticizing legal fees that have ballooned past $1 billion since the 2022 collapse.
The advocate has tracked the case for over three years, offering transparency to creditors on distributions, with the next payout record date set for February 14.
The post comes amid Bankman-Fried’s recent prison activity, including a pro se motion for a new trial claiming FTX “was never bankrupt” and that lawyers filed without his approval. Creditors have seen some recovery, up to 85 cents on the dollar in estimates, but disputes linger over IRS claims and potential clawbacks. A June 2024 settlement capped IRS demands at $885 million, yet advocates like Mr. Purple argue the plan lacks clarity for larger claims.
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