FTX, the bankrupt cryptocurrency exchange, is seeking answers from the Center for AI Safety (CAIS), a nonprofit organization dedicated to AI risk mitigation.
The firm is demanding the charity accounts for the $6.5 million it transferred to CAIS between May and September 2022, according to a recent court filing.
FTX Probes SBF’s Effective Altruism Payments
The move is part of a broader initiative by FTX’s CEO, John J III, to recover funds for its customers. The strategy involves scrutinizing substantial payments made prior to the Chapter 11 filing. These payments were made when Sam Bankman-Fried, a prominent advocate of effective altruism, was at the helm.
Read more: Who Is John J. Ray III, FTX’s New CEO?
Bankman-Fried’s philanthropic endeavors, however, have come under scrutiny. The former CEO was renowned for his generous political contributions and charity work. Yet, after FTX filed for bankruptcy, it emerged that these donations were funded using users’ monies. Consequently, the firm is now seeking to recover these funds.
The $6.5 million payment to CAIS is particularly significant. The nonprofit warned of AI existential threats in an open letter signed by 350 executives and researchers.
FTX’s request for subpoenas comes after CAIS reportedly declined to voluntarily provide an accounting related to the transfers. The subpoenas, if granted, would demand documents related to any assets or funds CAIS received from FTX or its affiliates.
FTX Threatens to Recover Donations
FTX’s recovery attempts are extensive. The firm sued its European arm for $323.5 million, alleging insiders’ misuse of funds. In addition, FTX has threatened legal action against political recipients who decline to return donations voluntarily.
The case underscores the growing scrutiny of cryptocurrency donations, particularly those made by high-profile industry figures. It also highlights the potential risks and accountability issues associated with such donations, especially when they involve user funds.
Read more: FTX Collapse Explained: How Sam Bankman-Fried’s Empire Fell
