Disgraced FTX founder Sam Bankman-Fried’s full ready testimony has been leaked, revealing the rambling, grievance-laden opening assertion he deliberate to ship in a Congressional listening to on Tuesday had he not been arrested.
Within the 18 pages of remarks, Bankman-Fried blames his enterprise rivals for his downfall, casts aspersions on the workforce main FTX by chapter, and lamented his private fortune declining to simply $100,000.
Bankman-Fried was not capable of ship the remarks to the Home Monetary Providers Committee listening to following his arrest on Monday within the Bahamas, the place he awaits extradition to the US to face expenses for monetary crimes and marketing campaign finance violations.
His ready remarks opened with the crude admission ‘I f***ed up,’ a line Rep. Emanuel Cleaver slammed as ‘so disrespectful,’ including: ‘Completely insulting, that is the Congress of the US.’
Within the assertion, first shared in full by Forbes, Bankman-Fried went on to lament that his web price had plunged from an estimated $20 billion to about $100,000.
Disgraced FTX founder Sam Bankman-Fried’s full ready testimony has been leaked, revealing the rambling, grievance-laden opening assertion he deliberate to ship
Home Monetary Providers Committee Chair Consultant Maxine Waters (D-CA) listens whereas U.S. Consultant Anthony Gonzalez (R-OH) speaks at Tuesday’s listening to
‘I do not know for positive, as a result of I’ve been denied entry to a lot of my very own private passwords, information, paperwork, and accounts,’ he mentioned.
Nonetheless, Bankman-Fried famous: ‘I might be flawed to say that I’ve nothing: I’ve a loving household, and meals on my plate, and that is greater than life has given billions of individuals.’
Bankman-Fried resigned because the CEO of FTX on November 11, the identical day the corporate filed for chapter, and was changed by legal professional and skilled liquidator John Ray III, who helped unwind Enron.
All through his testimony, Bankman-Fried castigated Ray, complaining that Ray had not returned his emails and had locked him out of even his private accounts.
‘I deeply remorse giving in to stress to signal varieties that precipitated the Chapter 11 submitting just some days after FTX Worldwide turned doubtlessly bancrupt,’ he mentioned.
Warning: Graphic Language
‘I’ve reached out to Mr. Ray and the Chapter 11 workforce quite a few instances. Generally I have been requesting entry to my very own information, however different instances I have been making an attempt to alert them to doubtlessly vital info for his or her jobs and duties to collectors and clients of FTX,’ mentioned Bankman-Fried.
He lamented that he had despatched 5 emails to Ray, who ‘by no means responded’ to his entreaties.
Bankman-Fried’s assertion additionally devotes seven pages to what he calls ‘Misstatements,’ accusing Ray and his workforce spreading false details about the businesses he created.
‘I imagine that United States regulators might have been advised materially deceptive details about FTX US, together with claims that FTX US will not be solvent. I imagine that it’s solvent,’ Bankman-Fried claims.
Elsewhere, Bankman-Fried devotes appreciable power to blaming rival crypto trade Binance and its CEO Changpeng Zhao for the collapse of FTX.
Bankman-Fried devotes appreciable power to blaming rival crypto trade Binance and its CEO Changpeng Zhao (above) for the collapse of FTX
He accuses Zhao of orchestrating a ‘sustained destructive PR’ marketing campaign that contributed to his downfall.
‘There’s rather more to say about Binance, its position within the cryptocurrency ecosystem, and its relationship with FTX, however that is neither the place nor the time for it,’ Bankman-Fried’s remarks added.
The testimony additionally denied ‘numerous claims that I created a hard-partying tradition at FTX’
‘Our ‘events’ have been principally dinner and board video games,’ mentioned Bankman-Fried. ‘I did not have my first drink till I used to be 21, and to my data have by no means been drunk.’
Bankman-Fried additionally revealed that he has been taking prescribed antidepressants for practically a decade.
‘The previous few months have been tough sufficient for everybody that it feels unremarkable to me, as compared, that I must placed on the official Congressional Report that I’m, and for many of my grownup life have been, unhappy,’ he mentioned.
Bankman-Fried additionally alluded not directly to anti-Semitism, remarking on ‘claims that I’m Jewish’ and noting ‘technically this declare is appropriate’.
‘I do not suppose I must spell out the implications being made,’ he mentioned, apparently referring to anti-Jewish prejudice.
New FTX CEO tears into Sam Bankman-Fried in Congress – hours after his arrest
Crypto large FTX’s new CEO tore into ‘inexperienced and unsophisticated’ firm founder Sam Bankman-Fried’s dealing with of the corporate at a Congressional listening to on its implosion on Tuesday.
The Home Monetary Providers Committee is investigating the multibillion greenback crypto agency, which not too long ago collapsed after a $5 billion ‘spending binge’ the yr earlier than, its new CEO advised lawmakers in his opening testimony.
John J Ray III was appointed to steer the corporate by chapter after its founder stepped down within the wake of its implosion. Ray shepherded Enron by one of many largest American company demises in historical past.
He blamed the company destruction of FTX on the ‘absolute focus of management within the palms of a really small group of grossly inexperienced and unsophisticated people.’
Ray advised lawmakers that of the dozen or so bankruptcies he is navigated corporations by, FTX stands proud as ‘extremely uncommon.’
‘Actually no report retaining in any way,’ he described the crypto large.
The seasoned government mentioned workers communicated invoices and different monetary paperwork by the workspace chat app Slack, and used Quickbooks accounting software program internally.
‘It’s a really good instrument – not for a multibillion greenback firm,’ Ray mentioned.
Firm founder Bankman-Fried was meant to look in entrance of the committee on Tuesday however was arrested within the Bahamas the earlier night.
FTX Group CEO John J. Ray III waits to start his testimony earlier than a U.S. Home Monetary Providers Committee listening to investigating the collapse of the now-bankrupt crypto trade FTX after the arrest of FTX founder Sam Bankman-Fried, on Capitol Hill in Washington, U.S. December 13, 2022
Ray mentioned he is shepherded roughly a dozen corporations by bankruptcies, however that FTX’s case was significantly ‘uncommon’
The 30-year-old billionaire is predicted to be extradited to the US. American federal prosecutors charged him with eight counts together with cash laundering and fraud.
Ray is main a bunch of investigators working to get better purchasers’ digital belongings, over $1 billion of which has already been discovered, Ray advised lawmakers. The corporate owes roughly $10 billion again to purchasers.
He confirmed to lawmakers on Tuesday that his workforce was sharing these findings with the Southern District of New York, the place Bankman-Fried was charged.
Requested how FTX’s sister agency Alameda Analysis may entry shopper funds, Ray mentioned, ‘There was no oversight’ and that ‘cash may transfer round’ with out detection.
Democrat Rep. Brad Sherman referred to as the FTX founder ‘an incredible huge snake within the crypto Backyard of Eden’ however added that ‘crypto is a backyard of snakes.’
Democratic Rep. Brad Sherman mentioned of FTX founder Sam Bankman-Fried, ‘My concern is that we’ll view Sam Bankman-Fried as only one huge snake in a crypto Backyard of Eden. The actual fact is, crypto is a backyard of snakes’
Throughout the listening to, Democratic Rep. Al Inexperienced took Bankman-Fried to job regardless of his absence over his claims that the mishandling of billions of {dollars} price of digital belongings was a ‘mistake.’
‘Dr. King reminded us that nothing in the entire world is extra harmful on the planet than honest ignorance and conscientious stupidity,’ Inexperienced mentioned.
Nevertheless, he added later, ‘I discover it tough to imagine we’re coping with conscientious stupidity.’
‘It appears to me it’s a must to be quite gifted to do the issues which have been performed, and do them efficiently,’ Inexperienced mentioned. ‘They only don’t emanate from ignorance and stupidity. And lots of people have been harm.
Ray was unable to pinpoint anyone downside that led to the collapse, quite blaming an array of defective selections and an absence of enough coverage obstacles in place.
It’s actually simply the limitless skill of these in management positions to borrow buyer funds or take buyer funds and deploy them for their very own use,’ Ray mentioned. ‘Actually the misuse of funds, and it’s so simple as that.’
Committee chair Rep. Maxine Waters mentioned within the listening to’s opening, ‘Just some months in the past, FTX was one of many largest cryptocurrency exchanges in your entire world…At present FTX is bankrupt, and probably looted.’
She mentioned she was ‘troubled’ to see ‘how widespread it was for Bankman-Fried and FTX workers to steal from the cookie jar’ of buyer money to ‘fund their lavish life-style.’
Republican rating member of the Committee U.S. Rep. Patrick McHenry (R-NC) and Home Monetary Providers Committee Chair Rep. Maxine Waters (D-CA) discuss earlier than the beginning of Tuesday’s listening to
Democrat Rep. Al Inexperienced mentioned of Bankman-Fried’s insistence that it was a ‘mistake’: ‘I discover it tough to imagine we’re coping with conscientious stupidity’
Lawmakers accuse the corporate’s executives of misusing $10 billion in shopper funds whereas owing collectors ‘not less than $3 billion.’
Rating member Rep. Patrick McHenry lauded Bankman-Fried’s arrest as ‘welcome information.’
‘Bankman-Fried’s play is nothing new, we have seen it earlier than,’ McHenry mentioned. He in contrast the younger billionaire to railroad barons of the nineteenth century and the identical Enron scandal Ray oversaw years earlier than.
Ray mentioned the corporate ‘did not implement just about any of the techniques or controls’ wanted for corporations charged with dealing with shopper funds.
He careworn that his investigation was nonetheless in preliminary phases, however has gathered sufficient info to know FTX ‘uncovered buyer funds to huge losses’ with dangerous investments, and that ‘loans and different funds have been made to insiders in extra of $1.5 billion.’
Requested by Kentucky GOP Rep. Andy Barr why he did not belief the corporate’s personal inner audits, Ray pointed to the $8 billion in shopper funds nonetheless lacking.’
‘I do not belief a single piece of paper on this group,’ Ray mentioned.
Greater than $1 billion has been recovered to date, he mentioned, a majority of which have been ‘cash of varied nature.’
However Ray wouldn’t give an estimate of when the remaining funds could be discovered.
‘These bankruptcies take time, the cash will take time to find…we tried to do that in probably the most expeditious method doable,’ he mentioned.
He advised GOP Rep. Tom Emmer that one in all FTX’s subsidiary corporations, FTX.com, didn’t actually have a human assets or accounting division.
