
Senator Elizabeth Warren (D-Massachusetts) and Rep. Sheldon Whitehouse (DR.I) wrote to the U.S. Department of Justice (DOJ) expressing their concerns about FTX implosion.
Warren and the White House wrote in a Nov. 23 letter that DOJ asked FTX executives to “throw the fullest extent of the law” over the fraud and misconduct allegations that led to the eventual collapse of the $32 billion exchange. to be held responsible for just a moment ago.
Senators say Genesis’ $175 million locked in FTX trading accounts, Galois Capital’s $100 million locked in FTX accounts, and BlockFi must stop withdrawals, prepare for bankruptcy, etc. , noted the impact FTX has had on businesses.
The letter also notes that FTX wants to repay up to $8 billion in debt to its customers, many of them private investors.
SBF confesses At an investor conference that Alameda Research owed FTX an estimated $10 billion in customer deposits that were loaned out without customer consent. This is considered a violation of both FTX’s own terms of service and US securities laws.
FTX created a false sense of security and legitimacy, encouraging consumers to pour their hard-earned money into investing in exchanges, Warren and the White House said in their letter.
Before FTX collapse, Sam Bankman-Fried (SBF) Customers with peace of mind That “FTX has enough to cover all client holdings. We do not invest in client assets (even in treasuries).” was discovered and the original tweet was deleted.
Pointing to ex-CEO Sam Bankman-Fried (SBF)’s attempt to minimize concerns before collapse, senator says it’s clear SBF and company representatives were ‘lying’ said it was.
“FTX’s collapse was not simply the result of poor business or management practices, but was caused by the deliberate and deceptive tactics employed by Bankman-Fried and other FTX executives to enrich themselves. It seems that.”
The senator concluded the letter by pleading with the DOJ to prosecute those responsible for the damage caused to victims of the exchange’s collapse.
New FTX CEO, John Jay Ray III, who managed the historic bankruptcy of energy trading giant Enron, has since highlighted the negligence shown by Sam Bankman-Fried, describing it as a “complete failure of corporate control.” .