Sam Bankman-Fried Slams New FTX CEO, Calls John Ray's Testimony 'False'

Zinger Key Points
  • Sam Bankman-Fried accuses new FTX CEO of submitting false testimony in legal records.
  • FTX founder concedes poor controls in critical places.
Sam Bankman-Fried Slams New FTX CEO, Calls John Ray's Testimony 'False'

Slamming new FTX CEO John J Ray III for his testimony on FTX's poor record-keeping and unreliable financial data, the exchange’s founder Sam Bankman-Fried said Ray's statements put in legal records were “false.”

Ray, a restructuring expert, testified in a bankruptcy case on Nov. 17.

FTX FTT/USD had filed for Chapter 11 bankruptcy in Delaware the week before.

Bankman-Fried said "statements that have been made, that have been put on legal record that I knew to be false" in an interview with The Block on Monday.

Limited Access To Data, Says Bankman-Fried

“There have been cases where it's been said XYZ did not exist and I am staring at a copy of XYZ,” he added.

Bankman-Fried said that after quitting his position as CEO of FTX, he had "limited access to data."

Bankman-Fried claimed that Ray and his staff ignored his emails over the issue, and that the falsehoods might be the result of lying or simply honest mistakes.

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Responding to a query over subpar financial controls, Bankman-Fried said, “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, including company books and documented policies,” Bankman-Fried said.

There Were Places With Poor Financial Controls

“I would dispute the claim that there were zero financial controls. 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,” he added.

In an earlier deposition, Ray stated that the situation at FTX was the first time in his 40-year career that he had witnessed "such a catastrophic failure of corporate controls and such a complete absence of trustworthy financial information."

According to Ray, the corporation did not even have a complete list of the employees on its payroll, let alone the proper books, records, or security measures for its digital assets.

Alameda Research's trading arm and associated companies did not maintain comprehensive records of their investments, according to Ray, who also argued that the court shouldn't rely on audited financial statements about which he had "substantial concerns."

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Posted In: Alameda ResearchJohn J Ray IIISam Bankman-FriedCryptocurrencyNewsMarkets

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