Sam Bankman-Fried, the disgraced former CEO of FTX, on Sunday dodged House Financial Services Committee Chair Maxine Waters’ (D-CA) call to testify.
of digital currency exchange FTX, as well as its sister organization hedge fund Alameda Research, rocked the cryptocurrency industry. As lawmakers and public officials try to figure out what happened, the Department of Justice has requested an independent inquiry into FTX regarding fraud allegations.that Bankman-Fried and his cofounders donated over $300,000 to nine lawmakers who are now investigating the company for wrongdoing.
DOJ Trustee Andrew R. Vara said in the agency’s filing: “An examiner could – and should – investigate the substantial and serious allegations of fraud, dishonesty, incompetence, misconduct and mismanagement by the Debtors.”as the “fastest big corporate failure in American history.” According to Vara, there is a strong reason to believe that Bankman-Fried, the former CEO, and other managers, “mismanaged” the company “or engaged in fraudulent conduct.
by misusing customer funds. In court filings, new FTX CEO John Jay Ray III stated that the company had hidden the misappropriation of corporate funds, including the purchase of a property in the Bahamas for employees. “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,” RayThe U.S. Attorney’s Office for the Southern District of New York and attorneys for the Securities and Exchange Commission have sent requests for information to cryptocurrency investors and trading firms that have worked with FTX.
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