Sam Bankman-Fried publishes a Substack newsletter in self-defense

Sam Bankman-Fried publishes a Substack newsletter in self-defense
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Fallen crypto founder Sam Bankman-Fried published a newsletter on a popular platform on Thursday offering a detailed defense of his actions.

“I didn’t steal money and I certainly didn’t stash billions,” said Bankman-Fried about how he ran the now-bankrupt cryptocurrency company FTX. millions of customers.

It was the largest public defense since the Department of Justice. filed Last month, Bankman-Fried filed eight counts of fraud, money laundering, and other charges, and the Securities and Exchange Commission and Commodity Futures Trading Commission filed related civil complaints. Collectively, they portrayed the executive as using long-time client money in FTX to fund his own risky investments, personal purchases, and campaign donations.

Bankman-Fried denied the Justice Department charges brought by the US Attorney General for the Southern District of New York. He is currently under house arrest at his family’s home in Palo Alto, California, and is set to stand trial on those charges later this year.

Bankman-Fried and his attorney, Mark Cohen, did not respond to a message seeking comment. A spokesperson for the Southern District of New York declined to comment.

Bankman-Fried’s comments came via a post on Thursday. A new account on Substack, the newsletter platform it created. The letter offered further details to support the sentiments the 30-year-old former CEO had made in a series of media interviews prior to his takeover. Arrested in Decemberappearances that he knowingly refuses to do anything unethical or illegal.

Bankman-Fried wrote on Thursday that FTX’s post-bankruptcy financial picture is less bleak than the company’s many legal and government critics claim.

For example, he wrote of the company’s America division that “FTX US is and always has been completely solvent” and said: “It was ridiculous that FTX US users had not yet been integrated and got their money back.”

But the lawyers of the restructured FTX I said In bankruptcy court on Wednesday, they said they had recovered nearly $5 billion to help repay creditors, the process was not straightforward.

Senior bankruptcy executive John J. Ray, who was brought in to try to clean up FTX, said it would take months to track down accounts and subsidiaries amid a series of missing bookkeeping. And 8 billion dollars cannot be accounted for, according to researchers.

Bankman-Fried says he was careless at FTX. Prosecutors say it’s fraud

As many customers await their inaccessible money, Bankman-Fried portrayed the losses not as any crime, but simply as the ups and downs of the markets.

“No money was stolen. Alameda lost money due to a market crash for which it was not adequately hedged,” he wrote, detailing the company’s investment strategy and path to bankruptcy.

Despite being a company Alameda helped found and run by people he was close to, Bankman-Fried sought to portray FTX as a separate victim of Alameda’s troubles, just as a number of independent crypto companies were affected by the wider contagion. market.

“FTX affected [by the Alameda challenges] Voyager and others as before,” he wrote, referring to the crypto asset manager. went under Last summer, due to falling values ​​at another crypto company, Terraform Labs.

But in the SEC complaint in your name Bankman-Fried is the “final decision maker” in Alameda. He also claimed to have made “undisclosed venture investments, generous real estate purchases, and large political donations” to its FTX sister firm with client deposits, painting a picture of a company far from being a helpless bystander in Alameda’s woes.

Prosecutors enlist the help of former Bankman-Fried partners Caroline Ellison and Gary Wang to assist with their case. cooperate with the government.

Bankman-Fried gave a series of interviews after the bankruptcy. long session With George Stephanopoulos of ABC. There is room kept tweeting Ever since he was indicted a month ago by prosecutors in SDNY.

The narration was consistent throughout :O she says Alameda has little information about it, let alone controlling its funds. And he would try to help people get their money back.

Thursday’s letter continued that theme. “I dedicate almost all of my personal assets to clients,” he wrote, without explaining how this would work or what it would mean.

But it also offered more financial details than in its previous statements. Bankman-Fried focused on how Alameda went bankrupt and chose to ignore the impetus mainly to allegations against him that he illegally used FTX clients’ money to support his hedge fund.

Bankman-Fried wrote in his Substack post that he was trying to fix the record with testimony he witnessed. set to give “Unfortunately, the DOJ took action to arrest me the night before, precluding my testimony with a completely different news cycle,” wrote the House Financial Services Committee on Dec.

While Bankman-Fried tried to portray himself as a helpful figure on Thursday, Ray said the confusion was the manager’s own business.

“Never in my career have I seen so many corporate controls fail and reliable financial information so completely destroyed.” said last month How FTX and Alameda are run under Bankman-Fried.

Legal experts have repeatedly said that the crypto executive’s press releases are a bad idea, providing fodder for prosecutors to reconstruct their timeline and use comments against him.

It was unclear whether Substack was released as an ongoing newsletter or as a one-time update, but Bankman-Fried ended the post by stating that readers can wait. more than your writings.

“I have more to say,” he wrote. “But at least it’s a start.”

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