A former trader from Jane Street, hired by Sam Bankman-Fried to contribute to FTX’s philanthropic efforts, is currently in a legal battle to secure the remaining portion of his 2022 bonus.
Lawyers representing Ross Rheingans-Yoo claimed that the exchange had paid only $375,000 of his $650,000 bonus. They argued that FTX owes him $275,000 as the outstanding balance of his bonus.
Employee Denies Knowledge of Crypto Fraud
Rheingans-Yoo stated that he was onboarded by Bankman-Fried to supervise a charitable affiliate connected to FTX in the early months of 2022. According to court documents, Rheingans-Yoo anticipated his responsibilities, which included a $100,000 base salary, to encompass leadership in Latona Bioscience.
The details of Rheingans-Yoo’s employment were discussed through a Google Doc shared by the former CEO, specifying that he would serve as the program officer for the FTX Foundation.
The advisors handling FTX’s bankruptcy, on the other hand, contended that Latona is a “sham” non-profit entity, along with FTX Foundation, alleging that they engaged in investments and donations to life sciences companies primarily for Bankman-Fried’s personal benefit.
The new management of FTX has asserted that Latona and the FTX Foundation received over $71 million from commingled exchange customers and corporate funds for investments and donations in life sciences companies.
According to his lawyers, however, Rheingans-Yoo did not assist or support Bankman-Fried’s misconduct. The former employee also asserted that he had no prior knowledge of the convicted crypto mogul’s fraudulent activities and denied accusations made by FTX’s new management In July.
“I was not part of Bankman-Fried’s inner circle who knew about and facilitated the misappropriation of FTX customer funds. I did not aid and abet his breach of fiduciary duty to the Debtors.”
Additional $650K Charity Donation
In addition to pursuing the remaining portion of his monetary bonus, Rheingans-Yoo is also seeking $650,000 in what he refers to as “foundation direction units,” intending to donate this amount to charity.
Whether Rheingans-Yoo is entitled to compensation will be determined by the Delaware bankruptcy judge overseeing FTX’s Chapter 11 case. FTX advisers argued that Rheingans-Yoo’s claim for the $275,000 award “has no merit and should be denied.”
They also claimed that the defunct crypto exchange has already fully compensated Rheingans-Yoo his bonus, asserting that he chose to have a portion of the award repaid through options in the firm’s corporate affiliates before it entered bankruptcy – an assertion that Rheingans-Yoo has refuted.
Meanwhile, former FTX general counsel Can Sun and ex-employees Armani Ferrante and Claire Zhang have teamed up to launch a new exchange called the Backpack Exchange a year after the crypto exchange’s implosion.