Bankman-Fried’s Parents Stand By Their Sam—And Face Their Own Legal Perils

The couple, longtime Stanford Law professors, have an uphill battle ahead in trying to overturn their son’s conviction

Joseph Bankman and Barbara Fried attended their son’s trial and often took notes. JOHN TAGGART FOR THE WALL STREET JOURNAL

Barbara Fried wanted to get close to her son. 

During breaks in the monthlong criminal fraud trial of her firstborn child, Sam Bankman-Fried, she would sometimes leave her seat and walk up to the railing that separated him from the gallery. Watching him and his lawyers, often in silence, she was just inches away yet no more able to intervene on his behalf or prevent the conviction that many saw coming. 

Joseph Bankman and Barbara Fried had hovered nearby when their son soared to prominence as the crypto industry’s biggest star, and advised him as his company collapsed and the government made its case against him. And after a federal jury delivered a guilty verdict that could send him to prison for decades, his parents are trying to prepare him for what comes next. 

The couple maintain their son’s innocence and are helping formulate grounds for an appeal. They visited him at a Brooklyn, N.Y., jail on Tuesday to assure him he has a life worth living, even if much of it stands to be spent behind bars. His conviction carries a potential maximum sentence of 110 years, though defendants rarely receive the most severe punishment.

Their unwavering support isn’t all that unusual. But Bankman, 68 years old, and Fried, 72, aren’t like most parents. The luster of their careers as beloved Stanford Law professors helped pave the way for the stunning rise of their son’s crypto exchange, FTX. And their direct dealings with that company, and the perks they received from their son before FTX filed for bankruptcy, have opened them up to legal headaches of their own. 

Bankman worked for a time as a paid employee at FTX. Fried had no formal position there, but FTX alleges that she helped direct her son’s millions of dollars of political donations. The company, now under new management, has sued them both, arguing they pocketed millions that should be returned.

The couple’s lawyers have said the allegations are “completely false” and “a dangerous attempt to intimidate Joe and Barbara.”

FTX cryptocurrency exchange founder Sam Bankman-Fried, wearing prison clothing, speaks to his mother, Barbara Fried, across the low partition between the courtroom well and the galley after a hearing before U.S. Magistrate Judge Sarah Netburn in New York City, U.S. August 22, 2023 in a courtroom sketch. JANE ROSENBERG/REUTERS

In this courtroom sketch, Sam Bankman Fried’s parents Barbara Fried, left, and Joseph Bankman react to the jury verdict in Manhattan federal court, Thursday, Nov. 2, 2023, in New York. A New York jury has convicted FTX founder Sam Bankman-Fried of fraud charges. ELIZABETH WILLIAMS/ASSOCIATED PRESS

If the parents harbor any regrets about their actions, or their son’s, they haven’t shared them, several friends said. 

“I would think this is not the time for recriminations,” said Bob Gordon, a longtime colleague at Stanford Law, where Bankman and Fried met and taught for decades. “For either their children, or themselves.”

The couple raised Sam and his younger brother on the Stanford campus, near a student house known for its vegan food and nude parties. They often spoke to their young sons as if they were adults and encouraged others to do the same, friends and colleagues said. 

Respected legal minds, the couple had a deep reserve of powerful friends from Silicon Valley to Wall Street. Their reputations served as a credential for Bankman-Fried when he was building his crypto empire, opening doors to investors, regulators and politicians.

FTX was a crypto giant valued in the billions of dollars when the company moved to the Bahamas in 2021. Both Bankman and Fried applied for permanent residency there, according to the lawsuit. Bankman went on leave from Stanford to work for his son.

Bankman became a key decision maker, FTX said, managing tax issues and advising on job hires. He was supposed to be the adult in the room at a company populated with young high achievers.

FTX agreed to pay Bankman a $200,000 annual salary, according to the lawsuit, and in early 2022 he lobbied for more. Bankman-Fried sent his parents $10 million shortly afterward.

“We are so touched by this gift,” Bankman wrote to his son, according to the lawsuit. “Mom is announcing retirement, which she would not have done otherwise.”

There were other benefits, too. Bankman got a cameo in an FTX Super Bowl ad starring Larry David.

An FTX Super Bowl ad last year starring Larry David had Joseph Bankman in a cameo role.

Soon, the lawsuit said, the company bought the couple a $16.4 million house in a gated community near its headquarters. Their names were on the deed.

A spokeswoman for Bankman and Fried said that the house “was used as temporary housing while Joe worked in the Bahamas” and they never believed they owned it.

She said that FTX’s outside lawyers had assured the couple “that FTX would have all beneficial ownership of the house and agreed to document that in writing.”

When FTX unraveled in November 2022, Bankman tried to remain upbeat for his son. Bankman-Fried soon stepped down as CEO, and FTX filed for bankruptcy. Within weeks, Bankman-Fried was arrested.

Bankman-Fried lived with his parents for much of the year, under house arrest. Two Stanford friends of his parents had put hundreds of thousands of dollars on the line to secure his release on bond, allowing him to stay out of jail.

From his parents’ home, Bankman-Fried continued to speak openly about his case. In August, the judge revoked his bail and sent him to jail to await his trial.

For most of the year, both before their son was sent to jail and afterward, the couple tried to hold on to a semblance of normal life. They hosted their regular Sunday night dinners with friends. Bankman hasn’t taught at Stanford since late 2021, but he attended faculty luncheons and was often spotted walking around campus with their German shepherd, Sandor. The family got him after FTX collapsed, for security. 

Bankman-Fried’s trial started in New York last month. His parents arrived most mornings around 8:30. The two often took notes. Fried was sometimes allowed to speak briefly to her son during lunch breaks or before U.S. marshals returned him to jail at the end of each day.

When Bankman-Fried first testified, without a jury present, his mother held her head in her hands as a prosecutor asked a barrage of rapid-fire questions.

Sam Bankman-Fried, who founded and led FTX , was escorted from court in Nassau, Bahamas, last year after being charged by U.S. prosecutors following the cryptocurrency exchange’s collapse. PHOTO: DANTE CARRER/REUTERS

On the day that closing arguments began, Bankman and Fried sat out the morning, when the government started its final pitch to the jury. They returned when the defense argued in the afternoon. They left court that evening, their arms around each other’s shoulders. 

The next day, a federal jury convicted Bankman-Fried on all seven criminal counts. Bankman slumped forward when the verdict was read. Fried put her palms against her cheeks as tears streamed down her face. 

Throughout the trial, Bankman-Fried had rarely turned to the gallery to search for his parents. As he was led away from the courtroom, he looked at them and smiled. 

A hearing to set the length of Bankman-Fried’s sentence is slated for March 28. He also faces additional charges, including allegations of conspiracies to commit bank fraud and bribery, that could go to trial in March. His parents are gearing up for an appeal. 

It is likely a long shot. 

“Criminal appeals are always an extremely uphill battle,” said Renato Mariotti, a former federal prosecutor and a partner at Bryan Cave Leighton Paisner in Chicago, who isn’t involved in the FTX case. “When there’s overwhelming evidence and sweeping charges, you need a potential game-changer. And there wasn’t one.” 

Bankman and Fried returned to California on Wednesday, people familiar with the matter said. 

Bankman, who is also a clinical psychologist, has continued seeing some clients over the past year. He plans to resume his full practice.

People close to them say that their network of friends remains intact. They said they expect Bankman to start teaching again, possibly within the next year.  A Stanford spokeswoman declined to comment. 

Paul Brest, a former Stanford Law dean, said he sees no reason the university wouldn’t welcome back his friend. “I can’t imagine why any institution would take a position on the child of a faculty member,” he said.