A former Jane Street trader, personally recruited by Sam Bankman-Fried to assist in FTX’s charitable giving, is currently embroiled in a dispute over his 2022 bonus while vehemently denying any prior knowledge of the fallen crypto mogul’s fraud prior to the company’s financial collapse.
Ross Rheingans-Yoo, in a recent court filing, contends that FTX owes him the remaining $275,000 of his bonus after already receiving $375,000 just before the cryptocurrency exchange went bankrupt. In addition, Rheingans-Yoo denies the allegations made against him by FTX’s new management, claiming that he aided and abetted Bankman-Fried’s actions in the firm’s charitable arm.
This particular disagreement is part of a larger effort by FTX’s bankruptcy advisers to recover approximately $71.5 million in combined customer and corporate funds that were allegedly taken by the exchange’s charitable arm, FTX Foundation, and a nonprofit company led by Rheingans-Yoo named Latona Bioscience Group. Bankman-Fried, who previously worked at Jane Street before launching FTX, was convicted earlier this month of committing a massive fraud leading to the collapse of the crypto firm.
“I was not part of Bankman-Fried’s inner circle who knew about and facilitated the misappropriation of FTX customer funds,” Rheingans-Yoo stated in a sworn statement. “I had no knowledge of Bankman-Fried’s fraud. I did not aid and abet his breach of fiduciary duty to the Debtors.”
Rheingans-Yoo was initially recruited in early 2022 to oversee a charitable-giving affiliate of FTX, with his employment terms outlined in a Google Doc shared by Bankman-Fried. These terms stipulated his role as program officer of FTX Foundation with a $100,000 base salary, along with an expectation of leading Latona Bioscience.
FTX’s new management has accused Latona of being a “sham” non-profit company, alleging that the organization, along with FTX Foundation, used customer and corporate funds to make investments and donations for Bankman-Fried’s personal gain. However, Rheingans-Yoo denies these claims, stating that Latona is a legitimate non-profit and was capitalized through intercompany agreements with FTX’s related trading firm, Alameda Research.
In addition to seeking the remaining bonus payment, Rheingans-Yoo is also pursuing $650,000 in “foundation direction units” that he plans to donate to charity.
The question of Rheingans-Yoo’s compensation entitlement will be determined by the Delaware bankruptcy judge overseeing FTX’s Chapter 11 case. FTX advisers assert that Rheingans-Yoo’s claim for the $275,000 award “has no merit and should be denied.”
An FTX spokesman declined to comment on the matter. However, advisers for FTX argue that the crypto firm has already fully compensated Rheingans-Yoo because he chose to have the award partially repaid via options in the firm’s corporate affiliates before the bankruptcy filing. This is a claim that Rheingans-Yoo vehemently refutes.
The case is FTX Trading Ltd., 22-11068, in the US Bankruptcy Court for the District of Delaware.
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