The CEO of the cryptocurrency firm established by Sam Bankman-Fried delivered a harsh critique of the former crypto mogul in a communication to a judge set to pass sentence on him next week.
In the message, he labeled Bankman-Fried’s assertion that no customers, lenders, or investors were harmed as blatantly untrue, portraying him as someone ensnared in a “life of delusion.”
John J. Ray III, the CEO of FTX Trading Limited, conveyed to Judge Lewis A. Kaplan the enduring distress Bankman-Fried’s actions have inflicted on the victims.
“Mr. Bankman-Fried continues to live a life of delusion. The enterprise he abandoned on November 11, 2022, was far from being solvent or secure. Mr. Bankman-Fried embezzled vast amounts of funds and was justifiably found guilty by a jury,” Ray stated.
Ray aimed to address “material misstatements and omissions” in a document prepared for Bankman-Fried’s sentencing, where it was argued that FTX’s solvency at the time of bankruptcy filings meant that “harm to customers, lenders, and investors is zero.”
Ray countered this by stating, “As the principal professional overseeing a large team that has transformed a metaphorical dumpster fire into a debtor-in-possession nearing a reorganization plan that promises significant returns to creditors, I can affirm to the Court that such statements are entirely, insensitively, and evidently false.”
He detailed the extensive efforts by a team of professionals to recover assets squandered on luxury items, speculative ventures, and other losses, from the “ruins of Mr. Bankman-Fried’s vast criminal operation.”
At the trial, it was presented that Bankman-Fried had misappropriated over $10 billion from customers, lenders, and investors. Prosecutors have recommended a sentencing of 40 to 50 years in prison.
While Bankman-Fried’s defense has asked for a considerably shorter sentence, claiming restitution for financial losses, Ray argued that the victims could never be fully compensated.
He pointed out that a recent bankruptcy court hearing’s suggestions of full reimbursement overlook the drastic drop in cryptocurrency values and the misleading financial statements previously issued under Bankman-Fried’s management.
Furthermore, Ray highlighted the impossibility of recovering funds such as the alleged $150 million in bribes to Chinese officials or the discrepancy in the reported and actual bitcoin holdings on FTX.com.
He also mentioned the exorbitant spending on celebrity and political affiliations, underscoring the absence of remorse from Bankman-Fried and labeling his proclaimed commitment to effective altruism as deceitful.
