The Tribune

By NEIL HARTNELL

Tribune Business Editor

nhartnell@tribunemedia.net

The China Construction America (CCA) owned entity that developed The Pointe in downtown Nassau purportedly received $3.362m in “gifts or charitable contributions” from Sam Bankman-Fried’s private trading arm.

Court filings by John Ray, the FTX US executive overseeing 134 entities presently in Chapter 11 bankruptcy protection, have revealed that Newworld One Bay Street received a series of payments between January 14, 2022, and July 29, 2022, ranging from a low of $197,101 to as much as $879,375.

Some six payments, all for six-figure sums, were made during that six-and-a-half month period by Alameda Research, the hedge fund/trading vehicle created by Mr Bankman-Fried. Its activities were heavily financed by FTX investors, whose monies and assets were used to finance Alameda’s risky and speculative bets without their permission.

It is unclear why the payments, between two privately-owned entities, have been classified by Mr Ray and his team in their Delaware Bankruptcy Court filings as “gifts and charitable contributions”. They could potentially represent payment for accommodation that was provided to FTX and Alameda Research staff during the crypto exchange’s 14-month stay in The Bahamas prior to its early November 2022 collapse.

For the Margaritaville Beach Resort, which is also part of The Pointe complex in downtown Nassau, and was initially revealed to be Alameda Research’s fourth largest creditor with a sum of $55,319 due to it, has subsequently seen its claim increase ten-fold to almost $600,000.

Alameda Research workers were reported previously to have stayed for weeks - even months - in about 20 suites at One Particular Harbour, whose prices range from $365,000 to more than $6m. They were said to have been transported to and from the resort in a shuttle bus every day.

However, given that the payments to Newworld One Bay Street were made so close to FTX’s Chapter 11 bankruptcy filing, it is possible that Mr Ray and his team may seek to claw them back on the basis that they are “voidable preferences”.

The Alameda Research filings also allege that it transferred funds to FTX Digital Markets, the Bahamian-incorporated entity in provisional liquidation before the Supreme Court, to finance property purchases in this nation on behalf of Mr Bankman-Fried, his inner circle and other senior executives.

These transactions were described as an “inter-company payable from Alameda Research to FTX Digital Markets. Among the deals these financed were the $2.34m acquisition of a Sandyport property for Can Sun, FTXs general counsel; an $8.217m Albany property deal for Constance Wang; property purchases of $2.2m, $1.502m and $1.405m for Mr Bankman-Fried, Gary Wang and Nishad Singh at One Cable Beach; and an $8.87m Albany acquisition for Ryan Salame, FTX Digital Markets’ chief executive.

Several of these properties, part of a Bahamian real estate portfolio valued at over $241m in Mr Ray’s legal filings, were put in personal names rather than those of FTX Property Holdings, FTX Digital Markets or Alameda Research. Whether these transactions represent assets/monies belonging to the Bahamian liquidation or the Chapter 11 process are likely to be one of many legal battles between the local provisional liquidators and Mr Ray.

Meanwhile, the documents filed by the latter also reveal that Alameda Research had some $13.091m in its account with Lyford Cay-based Deltec Bank & Trust. The $50m loan it made to Deltec’s parent, Deltec International Group, which was arranged by Mr Salame, is also documented.

Those funds were received in October 2021 from Norton Hall Ltd, an entity alleged to be controlled by Mr Salame, but the inference is that these monies came from Alameda Research. “In the ordinary course of business, the parent company of Deltec Bank, Deltec International Group, received a short-term loan to fund strategic growth initiatives from Norton Hall Ltd, an entity affiliated with FTX,” Deltec said in a previous statement.

“While the terms of the loan extend until March 2023, Deltec International Group has been attempting to repay the loan in full since December 2022. Deltec International Group is currently awaiting information as to the proper instructions on how to repay the loan.” The “strategic growth initiatives” and loan terms were not disclosed.

Deltec then reiterated that it has “no credit or asset exposure” to FTX, while touting its year-end 2021 financial statements for showing that it is well-capitalised and has no debt. It also hailed its “unparalleled risk management”, along with “good corporate governance practices” and “regulatory compliance”, reassuring investors “there is no threat to the bank’s sustainability, safety and soundness”.