Certainly consult an attorney if you are holding unspent FTX grant funds.
The above answer is focused only on bankruptcy issues. That’s almost water under the bridge at this point: it is a virtual certainty that all FTX grant funds can be clawed back by the bankruptcy estate. That’s not even a legitimate dispute any more. It’s just a matter of whether your particular grant is small enough that you might fly under the radar (unlikely, and if that’s the thin reed you are relying on then you are as unwise as an FTX investor).
The above answer overlooks that—since a federal criminal indictment has now issued—those holding unspent FTX grant funds are now holding known stolen proceeds. This is now the criminal law realm, not the bankruptcy realm. If someone robs a jewelry store and then gives you a stolen necklace, once you learn that the necklace is stolen property you do not have the right to keep it. You must return it to the jewelry store. If you otherwise dispose of it, after learning that it was stolen, you do so at your peril. Potential criminal peril.
People now know that all FTX funds were, and are, stolen. At this point there is no genuine question about what to do with unspent FTX funds.
It is remarkable (from someone outside the EA community) the self-serving denial and rationalization that is going on about what to do with unspent FTX grant funds. There is only one lawful (and ethical) answer.
Can you cite a criminal prosecution under these circumstances—a scammer converts client funds and donates them to an unknowing charity, which does not return them on its own initiative? I can think of a counterexample—Minnesota retroactively changed its fraudulent conveyance law to protect certain charities who had received donations from Ponzi scammer Tom Peters. That wouldn’t have accomplished anything of note if retention of those funds was a crime. Somewhat similar discussion here with the American Cancer Society successfully defending a clawback in a Ponzi-like case. Do you think their lawyers just missed that these charities were holding on to stolen funds, and the federal courts that decided those cases couldn’t be bothered to mention that in passing?
There has also been zero discussion of potential criminal consequences in any statement I’ve read by a lawyer in the press about this matter. Notably, if the USA for SDNY viewed the situation the way you do, he would have presumably done more than “ask that you work with us . . . ” And the world’s most powerful person with a law degree has been mum so far on whether he will return $5.2MM in contributions from SBF.
Certainly consult an attorney if you are holding unspent FTX grant funds.
The above answer is focused only on bankruptcy issues. That’s almost water under the bridge at this point: it is a virtual certainty that all FTX grant funds can be clawed back by the bankruptcy estate. That’s not even a legitimate dispute any more. It’s just a matter of whether your particular grant is small enough that you might fly under the radar (unlikely, and if that’s the thin reed you are relying on then you are as unwise as an FTX investor).
The above answer overlooks that—since a federal criminal indictment has now issued—those holding unspent FTX grant funds are now holding known stolen proceeds. This is now the criminal law realm, not the bankruptcy realm. If someone robs a jewelry store and then gives you a stolen necklace, once you learn that the necklace is stolen property you do not have the right to keep it. You must return it to the jewelry store. If you otherwise dispose of it, after learning that it was stolen, you do so at your peril. Potential criminal peril.
People now know that all FTX funds were, and are, stolen. At this point there is no genuine question about what to do with unspent FTX funds.
It is remarkable (from someone outside the EA community) the self-serving denial and rationalization that is going on about what to do with unspent FTX grant funds. There is only one lawful (and ethical) answer.
Can you cite a criminal prosecution under these circumstances—a scammer converts client funds and donates them to an unknowing charity, which does not return them on its own initiative? I can think of a counterexample—Minnesota retroactively changed its fraudulent conveyance law to protect certain charities who had received donations from Ponzi scammer Tom Peters. That wouldn’t have accomplished anything of note if retention of those funds was a crime. Somewhat similar discussion here with the American Cancer Society successfully defending a clawback in a Ponzi-like case. Do you think their lawyers just missed that these charities were holding on to stolen funds, and the federal courts that decided those cases couldn’t be bothered to mention that in passing?
There has also been zero discussion of potential criminal consequences in any statement I’ve read by a lawyer in the press about this matter. Notably, if the USA for SDNY viewed the situation the way you do, he would have presumably done more than “ask that you work with us . . . ” And the world’s most powerful person with a law degree has been mum so far on whether he will return $5.2MM in contributions from SBF.