After the crypto firm collapsed, the executive who handled the Enron debacle was brought in – and said he’d never seen anything like it
. “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,” he wrote. Bear in mind this is the man parachuted in to oversee the collapse of energy company Enron after its fraud was revealed.
But FTX.com is only part of the business. The wider group is formed of a sprawling network of more than 100 related companies, all shared through the common ownership of Bankman-Fried and two of his co-founders, Gary Wang and Nishad Singh. No single investor other than the co-founders owns more than 2% of the equity of any of the four main “silos” that make up the group: FTX’s US crypto exchange, its hedge fund Alameda, its venture capital arm, and its international exchange.
It gets worse. No one was able to put together a list of FTX staff, Ray said. He had “substantial concerns” about the financial statements assembled under Bankman-Fried, and said they should not be treated as reliable. The group was used to buy homes for employees; the digital assets were controlled through “an unsecured group email account”.
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