FTX’s bankruptcy filings show ‘complete failure of corporate controls’

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Bankruptcy filings have called on Sam Bankman-Fried (SBF) and the entire FTX team for a complete failure of the company’s controls.

The latest bankruptcy filings have blamed SBF and its executives for being totally out of control of their business affairs.

FTX’s bankruptcy lawyers argue that SBF is actively trying to disrupt the entire bankruptcy process for the various entities under its business. According to the new CEO and lead attorney, SBF is currently battling the attorneys and executives hired to handle the bankruptcy process.

The lawyers have submitted an urgent application to transfer Chapter 15 bankruptcy proceedings in the Bahamas to the United States Bankruptcy Court in Delaware. The move is intended to ensure that the various bankruptcy cases are heard in one US court. Adam Landis, a partner at Landis, Roth & Cobb, said;

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“In terms of Mr. Bankman-Fried’s celebrity, his unconventional leadership style, his incessant and disruptive tweeting since the petition date, and the almost complete lack of reliable corporate data, these Chapter 11 cases are unprecedented. Mr. Bankman-Fried, the co-founder and controlling owner of all Debtors and of FTX DM, appears to support the JPL’s efforts to expand the scope of the FTX DM process in the Bahamas to make this Chapter 11 undermining Affairs, and to move assets from the debtors to accounts in the Bahamas under the control of the Bahamian government.

SBF and his team were criticized for their complete lack of corporate control over the company’s affairs. Chicago-based attorney John J. Ray III, who was appointed CEO of FTX after the collapse and currently handling bankruptcy filings, attacked SBF’s handling of the company. He wrote;

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“Never in my career have I seen such a complete failure of corporate controls and such a complete absence of reliable financial information as here,” wrote Ray, a corporate cleanup specialist who is a veteran of the Enron bankruptcy. “From compromised system integrity and deficient regulatory oversight abroad to the concentration of control in the hands of a very small group of inexperienced, inexperienced and potentially compromised individuals, this situation is unprecedented.”

In this latest cryptocurrency news, Ray revealed that most of FTX’s books have not been audited. Therefore, the information in the Company’s books may not be accurate. He added that SBF is actively trying to undermine the bankruptcy proceedings and clarified that the former CEO no longer speaks on behalf of the company.

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A balance sheet from Alameda Research revealed that the hedge fund personally loaned $1 billion to Bankman-Fried, another $2.3 billion to a company called Paper Bird Inc., $543 million to co-founder Nishad Singh, and $55 million to executive Ryan Salame