Disgraced FTX Founder to Testify at House Hearing on Crypto Exchange Crash

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It’s been a little over a week since disgraced FTX co-founder Sam Bankman-Fried was interviewed at a New York Times conference, telling attendees I never tried to defraud who whether it be. Shortly after that interview, U.S. Senate Banking, Housing, and Urban Affairs Committee Chairman Sherrod Brown sent a letter to Bankman-Fried, asking him to appear next week at a Senate committee hearing. titled Crypto Crash: Why the FTX Bubble Burst and the Harm to Consumers.

Brown wrote that there are still significant unanswered questions about how client funds were misappropriated, how clients were prevented from withdrawing their own money, and how you orchestrated a cover-up. Bankman-Fried missed the deadline yesterday to respond to Brown, but this morning he finally tweeted to confirm he was ready to speak to Congress. Now, this coming Tuesday, Bankman-Fried appears set to testify before the House Financial Services Committee the day before Brown’s Senate hearing.

I still don’t have access to much of my work or personal data, Bankman-Fried tweeted. So there’s a limit to what I can say, and I won’t be as helpful as I would like. But since the committee still thinks it would be helpful, I’m prepared to testify.

Ars could not immediately reach Bankman-Frieds attorney Mark Cohen for comment, but his legal team previously urged the FTX founder to be quiet. Cohen declined to comment on the New York Timesbeyond Bankman-Frieds tweets.

In Bankman-Frieds’ tweet thread this morning, he vowed to try to be helpful in the hearing, always seeming to be unaware of what went so wrong with FTX. He said he could “shed all the light” he could during the House hearing on his own failures, FTX’s ability to repay debts to US customers and his own thoughts on the crash.

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Since the collapse of FTX, Bankman-Fried has been lounging in a $30 million penthouse in the Bahamas, Bloomberg reported, giving interviews via video calls with reporters, and it’s possible he’ll go that route when he testifies before the House committee.

It remains unclear whether Bankman-Fried will also testify before the Senate on Dec. 14. In his letter, Brown warned Bankman-Fried that he was prepared to issue a subpoena to compel Bankman-Fried to testify.

While Bankman-Fried has recently appeared to open up in media interviews about what happened at FTX, it’s riskier for him to speak to Congress. If Bankman-Fried is found to have withheld information or made false statements during the House hearing, he could face fines or up to five years in prison. .

Last December, Bankman-Fried testified before the Financial Services Committee of the U.S. House of Representatives. At that time, he was helping Congress understand the benefits of financial innovation. He then told the House committee that FTX had become successful because customers had “easy access to financial products in one place, in many cases on a cell phone, without multiple checkers assessing rents and posing risks to the investor along the way”. It is, he said, “it is how the ecosystem of digital assets impacts the real daily lives of those involved and helps them achieve economic security along the journey.”

Less than a year later, Reuters reported that Bankman-Fried had “secretly transferred $10 billion in FTX client funds to Alameda Research”, while “at least $1 billion in client funds disappeared”. At the time, Bankman-Fried denied having “secretly” moved the funds, insisting that he rather misread the “confusing internal labeling”.

This morning, Bankman-Fried tweeted that part of the problem at FTX was that he stopped being a model CEO when he got lazy and disconnected. As Congress investigates FTX’s misuse of customer funds and stocks that wiped out billions of dollars owed to more than a million creditors, Bankman-Fried continues his apology tour from the penthouse in which he moved in three months after FTX’s successful summit and two months before advising Congress on “the future of finance.”

I’m sorry, Bankman-Fried tweeted. I hope people can learn from the difference between who I was and who I could have been.

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