Hard to fathom. Amazing revelations here regarding #FTX ‘s collapse from @JohnJRay ,who is overseeing #FTXbankruptcy & has 40 years of legal & restructuring experience.
https://twitter.com/tonyromm/status/1602372189109510146
“Nearly all of these situations (bankruptcies & corporate failures) share common characteristics, ranging from gross mismanagement, excessive leverage, failures of internal controls, failures of external checks as a result of audit firm failures, or insufficient board 2/
governance. But never in my career have I seen such an utter failure of corporate controls at every level of an organization, from the lack of financial statements to a complete failure of any internal controls or governance whatsoever.
Although our investigation is 3/
Although our investigation is 3/
ongoing and detailed findings will have to await its conclusion, the FTX Group’s collapse appears to stem from the absolute concentration of control in the hands of a very small group of grossly inexperienced and unsophisticated individuals who failed to implement 4/
virtually any of the systems or controls that are necessary for a company that is entrusted with other people’s money or assets…
The fundamental, overarching challenge with each of these objectives is that we are, in many respects, starting from near-zero in 5/
The fundamental, overarching challenge with each of these objectives is that we are, in many respects, starting from near-zero in 5/
terms of the corporate infrastructure and record-keeping that one would expect to find in a multi-billion dollar international business…
The scope of the investigation underway is enormous. It involves detailed tracing of money flows & asset 6/
The scope of the investigation underway is enormous. It involves detailed tracing of money flows & asset 6/
transfers from the time of FTX’s founding, and highly complex technological efforts to identify and trace crypto assets.
We know the following:
⭐️First, customer assets from FTX.com were commingled with assets from the Alameda trading platform. 7/
We know the following:
⭐️First, customer assets from FTX.com were commingled with assets from the Alameda trading platform. 7/
⭐️Second, Alameda used client funds to engage in margin trading which exposed customer funds to massive losses.
⭐️Third, the FTX Group went on a spending binge in late 2021 through 2022, during which approximately $5 billion was spent buying a myriad of 8/
⭐️Third, the FTX Group went on a spending binge in late 2021 through 2022, during which approximately $5 billion was spent buying a myriad of 8/
businesses & investments, many of which may be worth only a fraction of what was paid for them.
⭐️Fourth, loans and other payments were made to insiders in excess of $1 billion…”
Source: Ray’s planned testimony to the House Finance Committee 12/13. bit.ly/3HpupUS END
⭐️Fourth, loans and other payments were made to insiders in excess of $1 billion…”
Source: Ray’s planned testimony to the House Finance Committee 12/13. bit.ly/3HpupUS END
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