- SBF pleads not guilty to latest charges, and OKX to turn over frozen FTX assets: CNBC Crypto World CNBC Television
- Bitcoin, Ethereum, Dogecoin Spike Despite Crypto Exchange Shutdown After SEC Lawsuit: Analyst Says Apex Crypto Has ‘Plenty Of Room To Grow’ Benzinga
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- Crypto Analyst Benjamin Cowen Warns Bitcoin (BTC) Primed for ‘One More Scare’ – Here Are His Targets The Daily Hodl
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Tag Archives: sbf
FTX CEO says company engaged in ‘old-fashioned embezzlement’ under SBF
FTX’s bankruptcy-era CEO, John J. Ray III, appointed to shepherd the collapsed crypto exchange through Chapter 11 reorganization, testified on Tuesday that the company’s founder and former CEO, Sam Bankman-Fried, made multiple misstatements about his companies’ financials.
Ray, who oversaw Enron’s infamous corporate fraud, characterized FTX’s actions as “old fashioned embezzlement.”
“This is just taking money from customers and using it for your own purpose,” Ray said. “Not sophisticated at all,” he said, explaining that what might have been sophisticated about the scheme was hiding it in plain sight.
Ray’s testimony may also have shed light on the theories that underlie the Justice Department’s accusations against Bankman-Fried, who was charged with eight counts of wire fraud, securities fraud, and conspiracy in an indictment unsealed on Tuesday.
The agency’s criminal charges, which allege that Bankman-Fried misappropriated customer funds by allowing the funds to be used by his crypto hedge fund Alameda Research, require it to prove beyond a reasonable doubt that Bankman-Fried knew and intended to lie about the arrangement to customers or lenders.
The FTX chief’s testimony came before the U.S. House of Representatives’ Financial Services Committee, where Bankman-Fried was also scheduled to testify via video conference. However, the public’s opportunity to hear testimony from the embattled founder foreclosed after he was arrested Monday evening by Bahamian authorities.
Bahamian authorities took Bankman-Fried into custody at the request of the U.S. Justice Department on Monday night, based on its indictment originally filed under seal.
In the indictment, the DOJ charged Bankman-Fried with wire fraud and conspiracy to commit wire fraud against FTX customers and lenders, conspiracy to commit commodities fraud and securities fraud, conspiracy to violate money laundering laws, and conspiracy to defraud the U.S. government through violations of campaign finance laws.
In separate civil actions filed Tuesday, the U.S. Securities and Exchange Commission, and the U.S. Commodity and Futures Trading Commission, respectively, alleged Bankman-Fried violated securities laws and the Commodity Exchange Act and the agency’s regulations.
Asked if there’s any way that Bankman-Fried and FTX’s senior managers wouldn’t have known that its entities had commingled customer funds, allowing Alameda unlimited access to FTX customer accounts, Ray III said, “No.”
In an interview at the New York Times’ Dealbook Summit, Bankman-Fried said he didn’t “knowingly commingle [customer] funds.” He added that he “didn’t ever try to commit fraud on anyone,” that he “wasn’t “running Alameda,” and “didn’t know what was going on.”
Ray was also asked about contentions in Bankman-Fried’s leaked prepared hearing remarks which suggested FTX was solvent but for a run on the bank caused when Binance walked away from a planned investment in FTX, and that FTX US remains solvent and capable of paying off all of its customers. Bankman-Fried also tweeted the claim on November 10, the day before the exchange’s bankruptcy filing.
“Given the evidence you’ve gathered, is there any degree of truth to this claim,” Georgia Rep. Barry Loudermilk asked Ray.
“We still have a hole in the U.S., so as we sit here today it is not solvent. That’s just inaccurate. And I’m not sure how he would even know that, quite honestly. We’re hopeful,” Ray said.
“Prior to that episode, is your belief that FTX was solvent?” Ohio Rep. Anthony Gonzalez asked about Binance’s about-face. “No,” Ray replied.
Missouri Rep. Ann Wagner asked Ray if the transfer of FTX funds to Alameda could have been done by mistake, given that Bankman-Fried has publicly apologized for making mistakes in leading his companies.
“I don’t find any such statements to be credible,” Ray III said.
Rep. Wagner went on to say that FTX’s international trading platform, FTX.com, held itself out as having a sophisticated risk management system commensurate with the size of his operations.
“I can say that it’s absolutely false. There was no sophistication whatsoever,” Ray III said. “There was an absence of any management.”
Alexis Keenan is a legal reporter for Yahoo Finance. Follow Alexis on Twitter @alexiskweed.
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SBF tried to destabilize crypto market to save FTX: Report
Tether executives and Binance CEO Changpeng “CZ” Zhao worried that Sam Bankman-Fried (SBF), former FTX CEO, was attempting to destabilize the crypto market aiming to save the now-bankrupt exchange, according to reports on Dec. 9.
Messages seen by The Wall Street Journal of a Signal group chat named “Exchange coordination” reveals an argument between CZ and SBF on Nov. 10 about Tether’s stablecoin USDT.
According to the report, CZ and others in the group worried that trades made by Alameda Research were focusing on depeg the stablecoin, which would have a ripple effect in crypto prices. Binance CEO reportedly confronted SBF:
“Stop trying to depeg stablecoins. And stop doing anything. Stop now, don’t cause more damage.”
SBF denied the claims in a statement to the WSJ. Members in the Signal group include Kraken co-founder Jesse Powell, Paolo Ardoino, chief technology officer of Tether, among others.
The alleged argument happened a day after Binance announced that it wouldn’t bail out its troubled competitor FTX, citing “reports regarding mishandled customer funds and alleged US agency investigations.” On Nov. 10, Tether’s Ardoino also said the company have no “plans to invest or lend money to FTX/Alameda.”
As reported by Cointelegraph, new details about the failed agreement between Binance and FTX were revealed on Dec. 9. In a twitter thread, CZ referred to Bankman-Fried as a “fraudster,” saying Binance exited its position in FTX in July 2021 after becoming “increasingly uncomfortable with Alameda/SBF.” SBF was “unhinged” at the exchange pulling out, according to Binance’s CEO.
In response, SBF claimed that Binance “threatened to walk at the last minute”, accusing CZ of lying about his role in the deal.
On Nov 11, FTX Group and nearly 130 companies – including FTX Trading, FTX US, under West Realm Shires Services, and Alameda Research – filed for bankruptcy in the United States citing a “liquidity crunch”.
Since FTX’s bankruptcy, SBF has been named in seven class action lawsuits and numerous probes and investigations, including a market manipulation probe by federal prosecutors.
Elon Musk alleges SBF donated over $1B to Democrats: ‘Where did it go?’
Many in the crypto space have accused mainstream media of intentionally trying to water down the actions of FTX CEO Sam “SBF” Bankman-Fried, including Tesla CEO Elon Musk, who is on a self-proclaimed mission to position Twitter as “the most accurate source of information.”
While the world still overcomes the shock of FTX’s collapse and the realization that SBF had been misappropriating users’ funds and engaging in shady investment practices via its sister trading firm, Will Manidis, CEO of ScienceIO — a healthcare data platform — tweeted that SBF made one of the “highest ROI trades of all time” by donating $40 million to the right politicians, who he claims have allowed him to get away with stealing over $10 billion.
That’s just the publicly disclosed number. His actual support of Dem elections is probably over $1B. The money went somewhere, so where did it go?
— Elon Musk (@elonmusk) December 3, 2022
Musk responded to the tweet, alleging that the amount of money SBF actually donated to Democratic candidates was over $1 billion, which would be way more than the publicly disclosed amount of $40 million. SBF previously admitted to making “dark” donations to the Republican Party. Musk asked:
“His actual support of Dem elections is probably over $1B. The money went somewhere, so where did it go?”
Meanwhile, United States House Financial Services Committee Chair Maxine Waters, a Democrat, and ranking member Patrick McHenry, a Republican, have requested that SBF appear in an investigative hearing scheduled for Dec. 13.
.@SBF_FTX, we appreciate that you’ve been candid in your discussions about what happened at #FTX. Your willingness to talk to the public will help the company’s customers, investors, and others. To that end, we would welcome your participation in our hearing on the 13th.
— Maxine Waters (@RepMaxineWaters) December 2, 2022
Polygon CEO Ryan Wyatt responded to Waters’ request by stating that “he’s [SBF] a criminal. What is happening.”
Related: FTX collapse drives curiosity around Sam Bankman-Fried, Google data shows
This latest round of backlash against SBF comes shortly after he gave interviews during The New York Times‘ DealBook Summit and to Good Morning America.
During his so-called “apology tour,” SBF has been portraying himself as a victim and even received a round of applause at the end of his DealBook Summit appearance. According to Twitter user and developer Naomi, “Watching SBF’s interview is kind of like watching Casey Anthony’s documentary. They’re so mechanical, they’re so inauthentic in their delivery. If you feel any emotion, at all, it slows people down. The way it is expressed is a separate subjective matter.”
Update (Dec. 5, 10:10 pm UTC): This article previously stated that Bankman-Fried admitted to giving backdoor donations to the Democratic Party. It has been updated to reflect that his dark donations went to the Republican Party.
Elon Musk alleges SBF donated over $1B to Democrats: ‘Where did it go?’
Many in the crypto space have accused mainstream media of intentionally trying to water down the actions of FTX CEO Sam “SBF” Bankman-Fried, including Tesla CEO Elon Musk, who is on a self-proclaimed mission to position Twitter as “the most accurate source of information.”
While the world still overcomes the shock of FTX’s collapse and the realization that SBF had been misappropriating users’ funds and engaging in shady investment practices via its sister trading firm, Will Manidis, CEO of ScienceIO — a healthcare data platform — tweeted that SBF made one of the “highest ROI trades of all time” by donating $40 million to the right politicians, who he claims have allowed him to get away with stealing over $10 billion.
That’s just the publicly disclosed number. His actual support of Dem elections is probably over $1B. The money went somewhere, so where did it go?
— Elon Musk (@elonmusk) December 3, 2022
Musk responded to the tweet, alleging that the amount of money SBF actually donated to Democratic candidates was over $1 billion, which would be way more than the publicly disclosed amount of $40 million. SBF previously admitted to making “dark” donations to the Republican Party. Musk asked:
“His actual support of Dem elections is probably over $1B. The money went somewhere, so where did it go?”
Meanwhile, United States House Financial Services Committee Chair Maxine Waters, a Democrat, and ranking member Patrick McHenry, a Republican, have requested that SBF appear in an investigative hearing scheduled for Dec. 13.
.@SBF_FTX, we appreciate that you’ve been candid in your discussions about what happened at #FTX. Your willingness to talk to the public will help the company’s customers, investors, and others. To that end, we would welcome your participation in our hearing on the 13th.
— Maxine Waters (@RepMaxineWaters) December 2, 2022
Polygon CEO Ryan Wyatt responded to Waters’ request by stating that “he’s [SBF] a criminal. What is happening.”
Related: FTX collapse drives curiosity around Sam Bankman-Fried, Google data shows
This latest round of backlash against SBF comes shortly after he gave interviews during The New York Times‘ DealBook Summit and to Good Morning America.
During his so-called “apology tour,” SBF has been portraying himself as a victim and even received a round of applause at the end of his DealBook Summit appearance. According to Twitter user and developer Naomi, “Watching SBF’s interview is kind of like watching Casey Anthony’s documentary. They’re so mechanical, they’re so inauthentic in their delivery. If you feel any emotion, at all, it slows people down. The way it is expressed is a separate subjective matter.”
Update (Dec. 5, 10:10 pm UTC): This article previously stated that Bankman-Fried admitted to giving backdoor donations to the Democratic Party. It has been updated to reflect that his dark donations went to the Republican Party.
FTX bankruptcy is ‘somebody running a company that’s just dumb-as-f___ing greedy,’ says Mark Cuban
Billionaire Dallas Maverick’s owner Mark Cuban recently offered his perspective on the implosion of crypto platform FTX late this week.
“‘That’s somebody running a company that’s just dumb-as-fucking greedy.’”
Cuban, speaking on Friday at a conference in Washington, D.C. hosted by Sports Business Journal, shared the view that avarice was at the root of the downfall of one-time crypto darling Sam Bankman-Fried, whose firm FTX Group just filed for chapter 11 bankruptcy.
“So what does Sam Bankman [Fried] do, he’s just–‘gimme more, gimme more, gimme more.’ So I’m gonna borrow money, loan it to an affiliated company and hope and pretend to myself that the FTT tokens that are in there on my balance sheet are gonna to sustain their value.”
Check out: Mark Cuban says buying metaverse real estate is ‘the dumbest shit ever
FTX’s collapse marks a stunning turnabout for a company, which was once valued at $26 billion, and whose founder, Bankman-Fried was viewed by many in the crypto industry as a venerable actor in the Wild West of digital exchanges.
On Thursday, the 30-year-old entrepreneur tweeted: “I f—ked up, and should have done better,” referencing the collapse of his exchange.
Embattled FTX, short billions of dollars, sought bankruptcy protection after the exchange experienced the crypto equivalent of a bank run. FTX, an affiliated hedge fund Alameda Research, and dozens of other related companies also filed a bankruptcy petition in Delaware on Friday morning. Boasting a nearly $16 billion fortune recently, Sam Bankman Fried’s net worth had all but evaporated in the wake of the FTX implosion, according to the Bloomberg Billionaires Index.
The price of FTX’s native token FTT went down about 88.8% over the past seven days to around $2.74, according to CoinMarketCap data.
The U.S. Justice Department and the Securities and Exchange Commission are looking into the crypto exchange to determine whether any criminal activity or securities offenses were committed.
Regulators and are examining whether FTX used customer deposits to fund bets at Alameda Research, a no-no in traditional markets, according to reports.
Cuban, who is one of the stars of the investing show “Shark Tank” and owns the NBA’s Dallas Mavericks, is a big investor in crypto and blockchain-related platforms. According to a CNBC report, he has said that 80% of his investments that aren’t on Shark Tank are crypto-centric.
See: Tom Brady, Steph Curry and Kevin O’Leary set to lose big from FTX bankruptcy filing
For his part, Cuban is part of a class-action lawsuit accused of misleading investors into signing up for accounts with crypto platform Voyager Digital, which filed for bankruptcy in July. The suit alleges that Cuban touted his support for Voyager and referred to it “as close to risk-free as you’re gonna get in the crypto universe.”
Cuban mentioned Voyager in his Friday interview. Representatives for the billionaire investor didn’t immediately respond to a request for comment.
The Mavericks owner took to Twitter on Saturday to say that the crypto implosions “have been banking blowups. Lending to the wrong entity, misvaluations of collateral, arrogant arbs, followed by depositor runs.”
Cuban’s net worth is $4.6 billion, according to Forbes.