FTX Lacked “Accurate List” of Bank Accounts, Failed at Basic Bookkeeping

An Anonymous Coward writes:

Employee expenses were approved by posting emoji in Slack channels, DMs:

Sam Bankman-Fried's failed FTX business empire misused customer funds and lacked trustworthy financial statements or any real internal controls, according to the new boss of the collapsed $32 billion crypto exchange.

John Ray III, a veteran insolvency professional who oversaw the liquidation of Enron, said in a US court filing on Thursday that FTX was the worst case of corporate failure that he had seen in his more than 40-year career.

"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.

The statement underlined the chaos and mismanagement at the heart of what was once a leading crypto industry player with deep ties in Washington DC. The demise of Bankman-Fried's FTX empire has plunged crypto markets into a crisis. Bankman-Fried did not immediately respond to a request for comment on the new filing.

Ray said he had found at FTX international, FTX US and Bankman-Fried's Alameda Research trading company "compromised systems integrity," "faulty regulatory oversight," and a "concentration of control in the hands of a very small group of inexperienced, unsophisticated, and potentially compromised individuals."

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