The parents of Sam Bankman-Fried, founder of the collapsed cryptocurrency exchange FTX, are being sued for allegedly receiving millions of dollars improperly from the firm before its failure.

In a legal filing, managers of the now-bankrupt company accused Bankman-Fried's parents of holding funds that were "fraudulently transferred" to them and of turning a blind eye to misconduct at FTX. The lawsuit was filed on behalf of creditors who were owed money after FTX's collapse.

Bankman-Fried's parents, Stanford University professors Joseph Bankman and Barbara Fried, received a $10 million cash gift from FTX's partner firm Alameda Research, according to the filing. FTX also gave them title to a $16.4 million property in the Bahamas.

The legal action alleges that Bankman-Fried's parents exploited their positions to enrich themselves before FTX declared bankruptcy last year. The filing claims FTX was used as a "piggy bank" by insiders like Bankman-Fried.

Bankman-Fried was arrested in December and charged with illegally transferring customer funds to support his trading firm, make political donations, and purchase real estate. He has denied any criminal wrongdoing. His trial is scheduled to begin next month.

FTX was one of the largest crypto exchanges, valued at $15 billion in 2021. Its failure revealed major holes in its finances, with estimates of missing customer funds running as high as $8 billion.

The lawsuit aims to claw back money from Bankman-Fried's parents, accusing them of perpetuating fraud and concealing misconduct. Their attorneys have denied the allegations, calling them false and designed to prejudice their son's upcoming trial.