Sam Trabucco Ordered to Forfeit $70M in Assets as Part of FTX Bankruptcy Settlement

The legal fallout from FTX’s implosion continues to expand. Sam Trabucco, who previously served as co-CEO at Alameda Research, has reached a settlement requiring him to relinquish approximately $70 million in assets to compensate creditors of the failed exchange. This development, documented in a court filing from November 2024, represents another major recovery effort in what has become one of the most significant bankruptcy proceedings in recent financial history.

The Multi-Million Dollar Asset Package Trabucco Must Surrender

The settlement details reveal the scope of Trabucco’s financial obligations to FTX’s creditor base. He is required to relinquish ownership of two luxury San Francisco residential properties valued at $8.7 million combined. Additionally, Trabucco must forfeit a 53-foot yacht that he purchased in March 2022 for $2.5 million. Beyond tangible assets, the agreement requires him to abandon approximately $70 million in claims he held against other FTX creditors.

A particularly significant aspect of the settlement addresses what bankruptcy law terms “potentially avoidable transfers.” During his tenure at Alameda Research, Trabucco received nearly $40 million in such transfers. Under bankruptcy law, these funds are potentially subject to clawback provisions—meaning they could be recovered and returned to the estate if they originated from assets that belonged to FTX customers or stakeholders. The court filing indicates that these transfers now fall within the scope of assets available for creditor recovery.

Trabucco’s Leadership at Alameda and Pre-Collapse Timeline

Trabucco held a prominent position within Alameda Research as co-CEO, working closely alongside the firm’s founder and controlling stakeholder, Sam Bankman-Fried. Despite this central role, Trabucco departed from Alameda in August 2022—merely months before both Alameda Research and FTX filed for bankruptcy protection in late 2022. While he has consistently avoided admitting to any involvement in misconduct, his public communications at the time suggested he was aware of Alameda’s aggressive trading posture and elevated risk-taking strategies.

Alameda Research operated as a cryptocurrency hedge fund focused on trading and arbitrage activities. The structural relationship between Alameda and FTX created a labyrinthine system of cross-financing arrangements. Prosecutors have emphasized that these interconnections were instrumental in destabilizing both entities, with funds flowing between the companies in ways that obscured the true financial health of each organization and threatened customer assets held at FTX.

How Asset Recovery Fits Into the Broader FTX Bankruptcy

Trabucco’s asset forfeiture is not an isolated action but rather part of a comprehensive recovery strategy orchestrated by FTX’s bankruptcy administration team. The trustees managing the estate have systematically pursued asset recovery from senior executives and insiders who benefited from the complex financial arrangements between FTX and Alameda.

This coordinated approach reflects the scale of the bankruptcy itself. FTX’s collapse has been characterized by extensive investigation into how senior management—including Trabucco—accumulated substantial personal wealth through executive compensation packages, equity transfers, and other financial instruments connected to FTX operations. Sam Bankman-Fried, the exchange’s founder, faces numerous criminal charges encompassing wire fraud, conspiracy, and misappropriation of customer deposits.

The Trabucco settlement exemplifies how bankruptcy courts are working to restore value to thousands of creditors who lost funds due to FTX’s operational failures and mismanagement. Each major executive asset seizure brings the recovery effort closer to compensating those harmed by the platform’s collapse.

The Larger Implications for Crypto Governance

The ongoing bankruptcy proceedings have exposed significant gaps in regulatory oversight within the cryptocurrency industry. The case has highlighted how inadequate corporate governance structures and insufficient financial controls allowed a single firm to accumulate extraordinary leverage and operational risk. Industry observers anticipate that these proceedings will catalyze stronger compliance frameworks and governance standards across digital finance platforms moving forward.