Investigation reveals how FTX CEO, Sam Bankman-Fried, mismanaged $10 billion of customers’ funds

As Sam Bankman-Fried’s FTX enters bankruptcy protection,

A Reuters report has revealed that between $1 billion to $2 billion of customer funds have untraceably left bankrupt crypto lender FTX.

Separate investigations by Reuters and The Wall Street Journal found that FTX’s founder and ex-CEO Sam Bankman-Fried, transferred $10 billion of customer funds forr the digital asset trading house, Alameda Research, the sister company of FTX.

Notably, multiple regulators including the Department of Justice, as well as the Securities and Exchange Commission have launched probes into how FTX handled customer funds.

Reuters, citing sources that “held senior FTX positions until this week”
One source estimated the gap to between $1 billion to $2 billion.

In reaction to the report, Bankman-Fried “disagreed with the characterization” of the $10 billion transfer, adding that, “We didn’t secretly transfer.”

Last Sunday, Bankman-Fried convened a meeting with executives in Nassau to look at FTX’s books and figure out just how much cash the company needed to cover the hole in its balance sheet.

The heads of FTX’s regulatory and legal teams were reportedly in the room, as Bankman-Fried revealed multiple spreadsheets detailing how much cash FTX had loaned to Alameda and for what purpose, according to Reuters.

Those documents showed a $10 billion transfer of customer deposits from FTX to Alameda. They also revealed that some of these funds — somewhere in the range of $1 billion to $2 billion — could not be accounted for among Alameda’s assets.


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