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Sam Bankman-Fried's brother was on memo exchange about a plan to buy Pacific island of Nauru, lawsuit says

(C) Hadi Zaher | Moment | Getty Images
  • Gabe Bankman-Fried, the younger brother of FTX's founder, was on a memo exchange about a potential plan to buy the island nation of Nauru, a Delaware lawsuit alleges.
  • The allegation was in a suit filed by attorneys from Sullivan & Cromwell, which is seeking to recover billions of dollars from Sam Bankman-Fried after the collapse of FTX.
  • Nauru, with a population of about 12,000, is a little over 2,100 miles away from Brisbane, Australia.

Sam Bankman-Fried's younger brother was on a memo exchange, along with an officer of the FTX Foundation, about a potential plan to purchase the island nation of Nauru in the Pacific to create a fortified apocalypse bunker state, a lawsuit filed in Delaware bankruptcy court alleges.

Update: FTX founder Sam Bankman-Fried sentenced to 25 years for crypto fraud, to pay $11 billion in forfeiture

The memo, which was exchanged between Gabe Bankman-Fried, brother of the FTX founder, and the foundation representative described a possible purchase of Nauru in the "event where 50%-99.99% of people die." On the island, they could ensure that most effective altruists survived and could create "sensible regulation around human genetic enhancement, and build a lab there," the lawsuit said, citing the memo.

The suit was filed by attorneys from Sullivan & Cromwell, which is seeking to recover billions of dollars following the collapse of FTX.

Bunker life is a well-documented fixation among tech billionaires, particularly those who identify as doomsday preppers. There's also a fascination with buying large estates in the Pacific and even owning small islands there.

In his years running FTX, the elder Bankman-Fried brother touted a philanthropic lifestyle called effective altruism and established the philanthropic arm with that in mind. Devotees of effective altruism work to maximize their income so they can give away their money in a fashion they see as most beneficial to humankind.

Gabe Bankman-Fried was one of the most visible presences in Washington, D.C., connected to FTX, with charitable and political donations that ran into the hundreds of millions.

In a statement emailed to CNBC on Oct. 16, Michael Tremonte, Gabe Bankman-Fried's attorney, said "Gabriel Bankman-Fried did not create, endorse, contribute to, or draft a plan to acquire the island of Nauru. In truth, Gabe received by email a link to the memo, which he did not write or request, and did not forward to anyone else."

A representative for Nauru confirmed the island nation was not and has never been for sale.

Nauru, with a population of about 12,000, is a little over 2,100 miles away from Brisbane, Australia. It was there that FTX lawyers allege the Bankman-Fried team sought to establish an emergency base for itself and a select group of "EAs," or effective altruists.

In addition to serving as a haven in case of apocalypse, "probably there are other things it's useful to do with a sovereign country, too," according to the memo between the younger Bankman-Fried and the philanthropic advisor, which was noted in the suit.

Correction: The original version of this story published in July mischaracterized Gabe Bankman-Fried's alleged involvement with the plan to purchase Nauru. The lawsuit doesn't say he tried to buy or considered buying the island. The updated story also removes reference to Gabe Bankman-Fried as a top lobbyist for FTX. In a letter to CNBC, a lawyer for Gabe Bankman-Fried stated that his client was never a lobbyist for FTX. 

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