Crypto Chief Asks Competitors for $1B After Company Collapse Tells Twitter Followers 'I'm Sorry'

John J Ray III has spent 40 years cleaning up America’s biggest corporate failures. He’s never seen anything as bad as FTX

The man appointed as FTX’s Chapter 11 liquidator has told a US court he faces an “unprecedented situation,” with a total failure of corporate governance and a lack of reliable financial information.

In a 40-year career in corporate restructuring and administration, John J. Ray III has previously overseen some of the most notorious US corporate failures, most notably of energy giant Enron.

“Almost every situation I have been involved in has been characterized by some sort of deficiencies in internal controls, regulatory compliance, human resources and systems integrity,” he told the Delaware District Bankruptcy Court in a filing.

“Never in my career have I seen such a complete failure of corporate controls and a complete lack of reliable financial information as here.

“From the compromised system integrity and flawed regulatory oversight abroad, to the concentration of control in the hands of a very small group of inexperienced, inexperienced and potentially vulnerable individuals, this situation is unprecedented.”

FTX collapsed spectacularly in recent weeks, less than three years after the cryptocurrency exchange — founded by tech prodigy Sam Bankman-Fried and his partners Zixiao “Gary” Wang and Nishad Singh — began operations in May 2019.

The FTX.com platform quickly became one of the largest cryptocurrency exchanges in the world.

Mr. Ray pointed to Sam Bankman-Fried’s claim that by the end of 2021 there were around $15 billion in assets on the platform, which he said accounted for around 10 percent of global crypto trading volume at the time “Millions” transacted. from registered users.

“These numbers have not been verified by my team,” added Mr. Ray.

FTX had been involved in major sponsorships and philanthropies.(AP: Marta Lavandier/file )

Chartered Accountant headquartered in the Metaverse

In fact, much remains unconfirmed about the man now appointed chief executive officer of FTX Group, who took Mr. Bankman-Fried’s place when the company entered Chapter 11 bankruptcy on November 11.

Mr Ray’s report is littered with the following sentence:

“As this balance sheet was prepared while Mr. Bankman-Fried’s debtors were being controlled, I have no confidence in it and the information contained herein may not be accurate as of the date shown.”

Mr Ray said most of the subsidiaries within the group had no audited accounts, some had no accounts at all and among the few that were audited were some that were audited by a company he had never heard of.

“The accounting firm for the dot-com silo was Prager Metis, a firm I am not familiar with and whose website states that it is the ‘first CPA firm ever to officially open its Metaverse headquarters on the Metaverse platform Decentraland .'”

The lack of corporate governance extended to the total absence of board meetings for many of the companies within the group, the lack of an accurate list of bank accounts and account signers, and the companies’ inability to provide a complete list of their employees as of the date the company went into bankruptcy protection.

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