Disgraced FTX founder Sam Bankman-Fried ignored pleas from company lawyers and advisers. To file bankruptcy According to a report on Tuesday, it was “days” before the cryptocurrency platform exploded.
FTX general counsel Ryne Miller was among several who pleaded with Bankman-Fried and other executives to relinquish their control of the company. The New York Times Reported citing internal emails and text messages.
The mood grew so bad that FTX lawyers contacted Bankman-Fried’s father, Stanford law professor Joseph Bankman, to see if he would intervene and speak to his son.
Nov. 11 In the early hours of the morning, the day FTX filed for bankruptcy, Miller was still pleading with Bankman-Fried to sign the necessary documents.
“Can you please sign the document,” Miller wrote in a message at 2:29 p.m.
The news highlights the turmoil within FTX as it went from industry leader to pariah status in a matter of hours. Bankman-Fried faces intense legal and regulatory scrutiny over FTX’s collapse and his own actions, while plundering the company’s resources for non-business expenses.
Before the filing, Bankman-Fried continued to insist behind the scenes that the platform could pull itself out of its inevitable financial doom — even after rival platform Binance backed out of a deal to buy FTX due to concerns about its finances.
An FTX lawyer first pressed the company’s top executives To appoint John Ray III to oversee its bankruptcy on Nov. 9, according to the report. Ray, who currently serves as FTX CEO, is best known for leading the Enron bankruptcy-humiliated energy company.
Hours before the bankruptcy filing, Bankman-Fried was telling FTX workers that outside funding was needed to keep the platform afloat.
On Nov. 10 — a day before the bankruptcy filing — Miller reportedly emailed Bankman-Fried and other top FTX officials to immediately suspend operations on the cryptocurrency platform. In the message, Miller lamented that “the founding team is not currently in a cooperative state.”
Miller blamed Bankman-Fried and his close associates when FTX officials made a mistake in the bankruptcy filing by accidentally listing companies that were not under FTX Group’s control.
“We didn’t have the cooperation of the founders to produce this week,” Miller said. “It’s unfortunate.”
Miller was also responsible for FTX’s move to scrub executive bios from the company’s “About” page.
As reported by The PostBios for Bankman-Fried, co-founder Gary Wang, former chief regulatory officer Dan Friedberg and others has suddenly disappeared in recent days after the company filed for bankruptcy.
“Who can go to FTX.com and FTX US and remove pictures and bios of people under ‘About,'” Miller said in a group message to other executives, according to the report.
Banker-Fried declined to comment on text messages she exchanged with other FTX executives before the bankruptcy, the New York Times reported.
However, the former executive said he had identified “several parties” interested in providing the cash infusion even after the bankruptcy proceedings were underway.
Miller and FTX reportedly declined to comment on the situation.
FTX formally filed for Chapter 11 bankruptcy on November 11 as the company’s financial situation became untenable. Bankman-Fried broke the news with an apology via tweet.
“I’m so sorry, again, we ended up here.” Bankman-Fried said. “Hopefully things will find a way to recover. Hopefully this will bring them some transparency, trust and governance. Ultimately it will be better for the customers.
Bankman-Fried told a Vox reporter a few days later that she regretted the bankruptcy, describing the move as her “biggest single F-cup.”
Meanwhile, Ray and other members of FTX’s current board of trustees ousted Banker-Fried in court filings, accusing him of running the company like a “personal fiefdom” without any corporate governance standards.
Late Tuesday, Bankman-Fried was ordered by the Texas regulator to appear for a hearing on Feb. 2 over allegations that FTX US offered unregistered bond products through its yield-bearing service.