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Effective Altruist Leaders Were Warned About Sam Bankman-Fried Years Before FTX Collapsed — TIME
webCredibility Rating
3/5
Good(3)Good quality. Reputable source with community review or editorial standards, but less rigorous than peer-reviewed venues.
Rating inherited from publication venue: TIME
Relevant to AI safety governance discussions because EA is a major funding and intellectual source for AI safety work; the FTX scandal raised concerns about conflicts of interest, donor capture, and ethical accountability within AI safety institutions.
Metadata
Importance: 55/100news articlenews
Summary
A TIME investigation revealing that prominent figures in the Effective Altruism (EA) community received warnings about Sam Bankman-Fried's ethical conduct and risky behavior years before the collapse of FTX, yet failed to act. The piece examines how EA's close relationship with SBF and FTX funding created conflicts of interest and governance failures. It raises broader questions about EA's oversight mechanisms and the dangers of prioritizing financial ends over ethical means.
Key Points
- •EA leaders including those at key organizations were warned about SBF's willingness to bend ethical rules and take extreme risks, but warnings were not acted upon.
- •FTX and Alameda Research provided enormous funding to EA causes, creating financial dependencies that may have compromised critical oversight.
- •The collapse exposed tensions within EA between 'earning to give' justifications and accountability for donor conduct.
- •The scandal raised questions about whether EA's utilitarian framework enabled rationalization of unethical behavior ('ends justify the means').
- •The episode highlights systemic governance failures in philanthropic and ideological communities heavily reliant on single major donors.
Cited by 5 pages
| Page | Type | Quality |
|---|---|---|
| EA Institutions' Response to the FTX Collapse | -- | 53.0 |
| Longtermism's Philosophical Credibility After FTX | -- | 50.0 |
| Centre for Effective Altruism | Organization | 78.0 |
| FTX Future Fund | Organization | 60.0 |
| Nick Beckstead | Person | 60.0 |
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- [Politics](https://time.com/section/politics)
# Exclusive: Effective Altruist Leaders Were Repeatedly Warned About Sam Bankman-Fried Years Before FTX Collapsed
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Mar 15, 2023 7:00 AM ET
Photo Illustration by Neil Jamieson from TIME
by
[Charlotte Alter](https://time.com/author/charlotte-alter/)
Senior Correspondent
Mar 15, 2023 7:00 AM ET
Leaders of the Effective Altruism movement were repeatedly warned beginning in 2018 that Sam Bankman-Fried was unethical, duplicitous, and negligent in his role as CEO of Alameda Research, the crypto trading firm that went on to play a critical role in what federal prosecutors now say was among the biggest financial frauds in U.S. history. They apparently dismissed those warnings, sources say, before taking tens of millions of dollars from Bankman-Fried’s charitable fund for effective altruist causes.
When Alameda and Bankman-Fried’s cryptocurrency exchange FTX imploded in late 2022, these same effective altruist (EA) leaders professed outrage and ignorance. “I don’t know which emotion is stronger: my utter rage at Sam (and others?) for causing such harm to so many people, or my sadness and self-hatred for falling for this deception,” [tweeted](https://twitter.com/willmacaskill/status/1591218022362284034) Will MacAskill, the Oxford moral philosopher and intellectual figurehead of EA, who co-founded the Centre for Effective Altruism.
Yet MacAskill had long been aware of concerns around Bankman-Fried. He was personally cautioned about Bankman-Fried by at least three different people in a series of conversations in 2018 and 2019, according to interviews with four people familiar with those discussions and emails reviewed by TIME.
He wasn’t alone. Multiple EA leaders knew about the red flags surrounding Bankman-Fried by 2019, according to a TIME investigation based on contemporaneous documents and interviews with seven people familiar with the matter. Among the EA brain trust personally notified about Bankman-Fried’s questionable behavior and business ethics were Nick Beckstead, a moral philosopher who went on to lead Bankman-Fried’s philanthropic arm, the FTX Future Fund, and Holden Karnofsky, co-CEO of OpenPhilanthropy, a nonprofit organization that makes grants supporting EA causes. Some of the warnings were serious: sources say that MacAskill and Beckstead were repeatedly told that Bankman-Fried was untrustworthy, had inappropriate sexual relationships with subordinates, refused to implement standard business practices, and had
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