John Ray III: Sam Bankman-Fried Claims are “Demonstrably False”

By Mark Hunter

1 day agoFri Mar 22 2024 08:26:56

John-Ray-III---Sam-Bankman-Fried-Claims-are-_Demonstrably-False_

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  • FTX CEO John Ray III has strongly refuted Sam Bankman-Fried’s claim that no harm was done to FTX customers and creditors
  • Ray delivered an impactful statement ahead of Bankman-Fried’s sentencing, sharply criticizing his defense
  • The eight-page statement has potentially serious consequences if acknowledged by the court

Sam Bankman-Fried’s claim that no harm was done to customers and creditors following the collapse of the exchange is “categorically, callously, and demonstrably false,” according to 

CEO John Ray III. Ray claimed in an impact statement ahead of Bankman-Fried’s sentencing, using vivid imagery and strong criticism to bring his point home. The eight-page statement, made following the disgraced CEO’s statement in his defense, amounts to an evisceration that, if the court gives it weight, could spell serious trouble for Bankman-Fried.

Ray Dismissed Bankman-Fried’s Solvency Claims

Ray tackled Bankman-Fried’s version of events, which claimed that the damage to all concerned was minimal because everyone would get back what they had on the platform at the time of its collapse in November 2022.

Bankman-Fried tried to minimize the reported losses, saying that the most reasonable estimate of loss and harm to customers, lenders, and investors was in fact “zero” and that FTX was solvent at the time of its bankruptcy.”

Ray, in contrast, says that these claims are “reckless and false,” accusing Bankman-Fried of taking court transcripts out of context to support his argument and ignoring testimony that didn’t suit him. He also offered a striking summary of the state of FTX when he took over and the work that was needed to recover funds:

The value we hope to return to creditors would not exist without the tens of thousands of hours that dedicated professionals have spent digging through the rubble of Mr. Bankman-Fried’s sprawling criminal enterprise to unearth every possible dollar, token or other asset that was spent on luxury homes, private jets, overpriced speculative ventures, and otherwise lost to the four winds. And even taking into account the potential for achieving anticipated recovery levels, which is by no means assured, customers still will never be in the same position they would have been had they not crossed paths with Mr. Bankman-Fried and his so-called brand of “altruism.”

Ray revealed that FTX had just 105 bitcoins at the time of its collapse against customer entitlements of nearly 100,000, adding that the jury in Bankman-Fried’s case “has concluded beyond a reasonable doubt that Mr. Bankman-Fried stole them and converted them into other things.”

Bankman-Fried Living “a Life of Delusion”

Not content with this, Ray then detailed Bankman-Fried’s “Strategy of Misdirection and Deceit,” noting how the co-founder planned in advance to blame lawyers and the restructuring team for the loss of the coins, which he eventually did, a strategy that failed miserably and only made him look worse.

Ray summarized Bankman-Fried’s approach succinctly and accurately:

Mr. Bankman-Fried continues to live a life of delusion. The “business” he left on November 11, 2022 was neither solvent nor safe. Vast sums of money were stolen by Mr. Bankman-Fried, and he was rightly convicted by a jury of his peers.

Sam Bankman-Fried will be sentenced on 28 March, where prosecutors want a sentence of up to 50 years.