Alleged Improper Use of FTX Funds for the Purchase of a $2.5 Million Yacht

It’s alleged that funds from Sam Bankman-Fried’s FTX were used to buy a $2.5-million yacht, thought to be a gift for Sam Trabucco, the ex-co-CEO of Alameda Research. Court filings from July 31 and August 31 reveal a detailed account of transactions leading up to FTX’s bankruptcy, including a $2.5 million payment to the American Yacht Group on behalf of Trabucco.

Trabucco, an early hire at trading firm Alameda, a sister company to FTX, resigned on August 24, 2022, stating he could no longer justify his role and wanted to focus on other aspects of his life. Less than three months after his departure, both Alameda and FTX filed for bankruptcy.

A playful reference to the yacht was made in a farewell message from Caroline Ellison, Trabucco’s former co-CEO. A 2022 Financial Times article also noted that Trabucco had acquired a 52-foot yacht just before leaving Alameda, but didn’t specify the source of the funds. Trabucco had also paid a freelancer from Fiverr to name the boat.

Court records show that Trabucco received $15.5 million in cash payments, which is $9.5 million less than the amount cited by an FTX debtors group earlier in the year. The group alleged that FTX’s leadership obtained over $3 billion in direct payments not related to legitimate business expenses. Bankman-Fried alone is said to have received an astonishing $2.2 billion, while other executives, Nishad Singh, and Gary Wang, received $587 million and $246 million, respectively.

Bankman-Fried is currently detained at the Metropolitan Detention Center in New York and is set to go on trial on October 2, facing charges of witness tampering.

Though Trabucco was involved in Alameda’s decision-making alongside Ellison for almost a year, his decision to resign just months before the companies went under appears to have shielded him from legal repercussions. He has not been named in any charges against the firms and their leadership. Trabucco has largely remained out of the spotlight, with his last social media activity being a tweet on November 8, expressing sympathy for those affected by FTX’s downfall.

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