Alameda’s Sam Trabucco To Forfeit $70M In FTX Settlement

Former Alameda Research co-CEO Sam Trabucco will surrender ownership of two San Francisco apartments worth $8.7 million and a 53-foot yacht and relinquish his $70 million in claims he filed against FTX.

These concessions represent part of a settlement between bankrupt FTX, FTX Digital Markets, and Trabucco, which was submitted on Monday. “Following constructive, arm’s length negotiations, the Debtors, FTX DM, and Trabucco have reached an agreement that delivers significant value for the Debtors’ and FTX DM’s stakeholders without the delay and cost of litigation,” the settlement document said.

Alameda’s co-CEO $70M Claim Against FTX Dismissed

Sam Trabucco, who was a part of Sam Bankman-Fried’s inner circle until FTX and Alameda Research collapsed two years ago, has agreed to turn over a line of assets, including his yacht, to FTX creditors.

The former co-CEO of Alameda had purchased the 53-foot-long yacht for $2.51 million this March, just months before his exit from the hedge fund led by Bankman-Fried. Trabucco will also forfeit two San Francisco apartments he purchased in 2021 for a combined $8.7 million, according to the court filing.

FTX has settled with Trabucco

1) 2 apartments ($8.7m)
2) 53-foot Yacht ($2.5m)
3) Disallowed Customer claims ($70m)

Trabucco received $40m within 2 yrs before petition date pic.twitter.com/56cMDgWB0c

— Sunil (FTX Creditor Champion) (@sunil_trades) November 11, 2024

He has also agreed to assign his rights to approximately $70 million worth of claims filed against FTX, which will subsequently be deleted.

FTX and crypto trading firm Alameda Research were founded by former FTX CEO Sam Bankman-Fried, with Alameda also co-led by Caroline Ellison. Alameda’s tight ties to FTX came into sharp focus after FTX’s blowup. Trabucco had stepped down as co-CEO this past August, just months before FTX and Alameda blew up. “Just bought a boat,” he’d said when announcing his resignation.

FTX’s Complex Web: Another Piece of the Puzzle

According to the Monday filing, Trabucco filed $70 million in proofs of claim against FTX, Alameda Research, and related entities in June 2023.

As the settlement filing states, “Trabucco shall assign to the Debtors all rights and interests represented in and asserted through his claims filed against the Debtors, including with respect to his customer claims totaling approximately $70 million, and all of his claims against the Debtors shall be disallowed and expunged.”

In October, a US bankruptcy judge approved an FTX reorganisation plan that could see funds returned to clients nearly two years after the company’s collapse. The deal, it was believed, would see 98% of its creditors recover at least 118% of their claim value in cash.

Of the class of “dotcom customer entitlement claims” – which includes about $6.83 billion in claims by value – about 94% of creditors had voted for the plan. However, some had criticized the estate’s decision to distribute its funds in dollars rather than in cryptocurrencies.

FTX has since filed several bankruptcy lawsuits to claw back cash for its creditors. Recently, it sued Binance and its former CEO Changpeng Zhao for fraud and market manipulation, contending that a 2021 share buyback deal between the companies had been fraudulent and furthered FTX’s distressed financial situation.

FTX Estate also sued other investors, including Anthony Scaramucci’s SkyBridge Capital, to claw back investments it said were ill-advised. The efforts are part of FTX’s plan to maximize creditor recoveries through litigation, not lengthy and costly trials.

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