FTX Jets Worth Almost $30 Million May Be Seized

Updated: 06 October 2023

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The US Department of Justice (DOJ) may seize two luxury jets owned by Sam Bankman-Fried’s FTX on grounds they were bought with the proceeds of fraud.

The aircraft are a Bombardier Global and Embraer Legacy, according to a DoJ filing. Island Air Capital (IAC), which operates the jets, bought the Embraer for $12.5 million and the Bombardier for $15.9 million.

The luxury jets are already at the center of an ownership conflict between the DOJ and FTX. IAC filed a motion with the US Bankruptcy Court for the District of Delaware on September 21 regarding the ownership of the jets.

FTX And DOJ Battle Over SBF’s Luxury Jets

In its filing, the IAC said the government believed SBF bought the two aircraft using fraudulent funds. FTX claims ownership, saying that the loans used to purchase the jets were not documented.

The IAC seeks clarity on the jets’ ownership to know who will pay the costs for the ongoing repairs and inspections. The aviation company said that no one associated with FTX had flown in either plane, which were undergoing upgrades when FTX filed for bankruptcy.

The aviation company added that in early August it was finalizing the conditions of the seizure of the aircraft with the government, FTX claimed ownership of the jets.

“It is both patently unfair and impossible to expect and demand that [IAC] continue to fund the mounting expenses of the Aircraft without any protection,” the aviation company said.

Former FTX Employees Testify On Day Three Of SBF Trial

Bankman-Fried’s trail for fraud and conspiracy entered its third day yesterday, with former employees at FTX taking the stand.

The former chief technology officer at FTX, Gary Wang, gave his testimony on Thursday. He admitted that FTX gave Alameda special privileges, including withdrawing unlimited funds from FTX.

AUSA: What was the wire fraud?
Gary Wang: We allowed Alameda to withdraw unlimited funds.
Judge Kaplan: Mr. Wang, could you slow down?
[Some had said Gary Wang couldn't or wouldn't speak. But he's speaking, and fast]
— Inner City Press (@innercitypress) October 5, 2023

Wang also revealed that Alameda had an around $65 billion line of credit on FTX. The hedge fund could also execute trades faster than other market makers.

Former FTX engineer and former SBF roommate, Adam Yedidia, also testified on Thursday. In his testimony, Yedidia revealed that SBF encouraged employees to use Signal and set an auto-delete.

Judge Kaplan: Basis?
SBF's lawyer: Leading.
Judge Kaplan: Sustained.
AUSA: Did you share this document with the defendant?
Yedidia: Yes, by Signal. End to end encrypted. He told me to use Signal. He told the entire company. It also had auto-delete

— Inner City Press (@innercitypress) October 5, 2023

Yedidia said that SBF said it “was all down-side to keep messages around.” He told the jury that SBF believed regulators could use the messages against the company.

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