New FTX CEO Testimony ‘False,’ Bankman-Fried Says

The crypto exchange’s founder said documentation existed, despite John Ray bemoaning poor record-keeping.

AccessTimeIconDec 5, 2022 at 5:09 p.m. UTC
Updated Dec 6, 2022 at 2:18 p.m. UTC

Testimony from the new FTX chief executive John J Ray III is “false,” founder of the now-defunct crypto exchange Sam Bankman-Fried said in an interview with The Block.

In a bankruptcy deposition made Nov. 17, restructuring specialist Ray berated poor record-keeping and untrustworthy financial information at FTX, which had filed for Chapter 11 bankruptcy in Delaware on Nov. 11.

In an interview released Monday, Bankman-Fried referred to “statements that have been made, that have been put on legal record that I knew to be false.”

“There have been cases where it's been said XYZ did not exist, and I am staring at a copy of XYZ, ” Bankman-Fried added. Bankman-Fried has also previously said that he has had only “limited access to data” since stepping down as CEO.

Bankman-Fried said that the falsehoods could amount to lying or honest mistakes and that Ray and his team hadn't responded to Bankman-Fried’s emails on the issue.

“I think it's pretty hard, if you try and take over a company and refuse to talk with anyone who was involved in running that company, to, in a short period of time, know where any of the relevant data would be,” including company books and documented policies, Bankman-Fried said.

The comment came in response to a question about the new CEO’s comments on poor financial controls.

“I would dispute the claim that there were zero financial controls,” Bankman-Fried said. “I completely agree that there were places in which there were very poor controls and that those places were critical and that that was really bad.”

In his earlier deposition, Ray said he had never in his 40-year career seen “such a complete failure of corporate controls and such a complete absence of trustworthy financial information” as he saw when he took over at FTX.

Ray said the company didn't have appropriate books, records or security controls for its digital assets, or even a full list of staff on its payroll.

Trading arm Alameda Research and related businesses didn’t keep complete records of their investments, Ray said, adding that the court shouldn't rely on audited financial statements that he said he had “substantial concerns" about.


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Jack Schickler is a CoinDesk reporter focused on crypto regulations, based in Brussels, Belgium. He doesn’t own any crypto.

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