Sam Bankman-Fried claims new FTX CEO John Ray made ‘false’ claims in court filings

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Disgraced FTX founder Sam Bankman-Fried lashed out at the company’s new CEO John Ray, alleging he has made “false” statements in court filings during the company’s contentious bankruptcy proceedings.

Ray, who is tasked with steering FTX through intense legal and regulatory scrutiny, claimed in bankruptcy court last month that FTX lacked any corporate controls or accurate books tracking its finances prior to its downfall.

Bankman-Fried fired back during a two-hour podcast interview – the latest stop in an ongoing media apology tour in which the 30-year-old has tried to distance himself from the scandal even as customers and investors are still owed billions of dollars.

“There have been a lot of statements that have been made, that have been put on legal record, that I know to be false,” Bankman-Fried claimed when questioned Monday on “The Block.” “I don’t know if they were intentionally lying or that it was just an honest mistake because of people not consulting with anyone who knew where these records were.”

“There have been cases where it’s been said XYZ did not exist, and I am staring at a copy of XYZ,” Bankman-Fried added. “None of my emails have been answered.”

Bankman-Fried resigned as FTX CEO on Nov. 11, the same day the company filed for bankruptcy. Ray and other FTX caretakers have been sharply critical of the company’s previous management under Bankman-Fried and his associates in the days prior to its collapse.

In the testimony filed in court on Nov. 17, Ray, a restructuring expert and veteran of notorious energy firm Enron’s bankruptcy, described bookkeeping practices at FTX as the worst he’s encountered in his career.

“Never in my career have I seen such a complete failure of corporate controls and such a complete absence of trustworthy financial information as occurred here,” Ray said in the filing.

Sam Bankman-Fried is under intense legal pressure.
Getty Images

“From compromised systems integrity and faulty regulatory oversight abroad to the concentration of control in the hands of a very small group of inexperienced, unsophisticated and potentially compromised individuals, this situation is unprecedented,” Ray added.

Bankman-Fried, who has vacillated between apologetic and defiant tones in various media appearances about the FTX bankruptcy, pushed back on Ray’s characterization. He also accused FTX’s new leaders of refusing to speak with him.

“I would dispute the claim that there were zero financial controls,” Bankman-Fried said. “I completely agree that there were places in which there were very poor controls and that those places were critical and that that was really bad.”

John Ray
John Ray is FTX’s current CEO.
Bloomberg via Getty Images

“I think it’s pretty hard, if you try and take over a company and refuse to talk with anyone who was involved in running that company, to, in a short period of time, know where any of the relevant data would be,” he added.

Bankman-Fried has drawn comparisons to the late Ponzi scheme mastermind Bernie Madoff in recent days as FTX’s new leaders and investigators examine what happened at the company.

In one recent interview, Bankman-Fried claimed to have “misaccounted” a whopping $8 billion on FTX’s balance sheet just before it imploded.

FTX
FTX declared bankruptcy last month.
REUTERS

Much of the scrutiny has focused on Reuters’ report that Bankman-Fried secretly shifted $10 billion in FTX client funds to cover losses at Alameda Research, a sister crypto trading firm he also owned.

FTX’s new attorneys have also accused Bankman-Fried of running the company as if it were his “personal fiefdom” and overseeing lavish spending – including $300 million on luxury real estate in the Bahamas.

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