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FTX co-founder and former CEO Sam Bankman-Fried was interviewed at a New York Times conference yesterday and spoke publicly despite the advice of lawyers urging him to keep quiet about the collapsed cryptocurrency exchange. As FTX’s bankruptcy unfolds and lawmakers urge US authorities to pursue criminal charges, Bankman-Fried said he did not commit fraud intentionally.
“Obviously I made a lot of mistakes,” said Bankman-Fried. “There are things I would give anything to do again. I never tried to cheat anyone. I was excited about the prospects of FTX a month ago. I saw it as a thriving, growing business. I was shocked by what happened this month.” Bankman-Fried also said he “did not knowingly mix funds” with Alameda Research, a related company he co-founded and owned a portion of.
Bankman-Fried was interviewed by NYT columnist Andrew Ross Sorkin for the news organization’s DealBook Summit (see transcript). Bankman-Fried was in the Bahamas and appeared on a video feed.
Sorkin asked, “What are your lawyers telling you now?” Are they suggesting it’s a good idea for you to speak?’
‘No. They certainly aren’t,’ Bankman-Fried replied. “The classic advice, right: don’t say anything. Get back in a hole. And that’s not who I am. It’s not who I want to be… I have a duty to explain what happened.” He said he wants to help FTX customers, “and I don’t see the good of it if I just sit locked in a room and pretend the outside world doesn’t exist.”
No definitive answer on return to US
“You’re in the Bahamas now. Are you in the Bahamas because you don’t think you can leave?’ asked Sorkin.
“I’ve been in the Bahamas for the past year and I’m running FTX from the Bahamas,” Bankman-Fried replied, saying he’s been in contact “with Bahamian regulators and others” and is “looking to be helpful everywhere I go.” can with any of the global entities that want my help.”
When asked if he can travel to the United States, Bankman-Fried said, “As far as I know, I would… most appropriately.”
Sorkin asked if he is concerned about criminal charges. “It sounds weird to say it, but I think the real answer is I don’t focus on that,” said Bankman-Fried. “There will be a time and a place for me to think about myself and my own future. But I don’t think this is it… What matters here is the millions of customers. It’s about all stakeholders in FTX who got hurt and tried to do everything to help them.”
A Nov. 15 Bloomberg report said, “U.S. and Bahamian authorities have discussed the possibility of bringing Sam Bankman-Fried to the U.S. for questioning.”
Lawmakers are calling for criminal investigations
It is not yet clear whether Bankman-Fried will be prosecuted. Senators Elizabeth Warren (D-Mass.) and Sheldon Whitehouse (DR.I.) last week urged the U.S. Justice Department to investigate and possibly prosecute those responsible for harming FTX customers. Warren and Whitehouse’s letter emphatically noted that DOJ leaders made a “renewed commitment to investigate and prosecute white-collar crime” earlier this year.
The senators’ letter referenced a tweet from Bankman-Fried on Nov. 7 stating that “FTX has enough to cover all client assets” and that it does not invest client assets.
“However, when customers attempted to withdraw deposits, it became apparent that Mr. Bankman-Fried and the company’s representatives were lying,” the senators wrote. At an investor meeting, Mr. Bankman-Fried relented and admitted that Alameda Research, an affiliate trading platform of which he is the founder, owed FTX about $10 billion in client deposits that had been loaned without their consent – a violation of both US securities laws and FTX’s own terms of service.”
“I think the world is stunned that he’s not in custody,” U.S. Representative Warren Davidson (R-Ohio), a member of the House Committee on Financial Services, said on Fox Business during part of the interview with Bankman- Fried.
