Newly appointed CEO Ray says FTX is a “failure of corporate controls”
Newly appointed CEO Ray says FTX is a “failure of corporate controls”
The new CEO of FTX, John RayIII says the accounting was done in a way not suitable for a business enterprise under the leadership of Sam Bankman-Fried and that it is the worst case of his career.
Ray is the new overseer of the bankrupt FTX, who has almost 40 years of experience dealing with bankrupt firms, such as Enron.
According to the new court filing submitted by Ray, FTX is guilty of buying luxury real estate and personal items using corporate funds signed under the name of FTX’s employees and advisors.
Additionally, a penthouse worth $40M was listed near the place where SBF and other executives lived, raising suspicions about whether it was bought through unfair means by exploiting the users’ funds on FTX.
Buying real estate using corporate funds is alarming but signing it under the name of its employees is scary because this shows the whole FTX team is guilty of messing with customers’ funds.
As reported by NECN, the balance sheets of FTX are a complete mess due to a “complete lack of financial controls.” Even the auditing team, Prager Metis, seems to be not known to CEO Ray.
Before the bankruptcy, the names of auditors were kept hidden from the users and investors. Now, the accounting firm refuses to respond to any queries asked by regulators.
Before the bankruptcy, the names of auditors were kept hidden from the users and investors. Now, the accounting firm refuses to respond to any queries asked by regulators.
The only information known about Prager Metis is that it claims to be the first accounting firm in the metaverse. Since FTX managed to audit from this, other companies might also be in it as well.
Ray claims that FTX had no accounting department. Overall, the exchange was led by a very messy financial structure that didn’t benefit any users, only the executives, and SBF.
He also shared that it will take some time for his team to properly locate all the fund transfers and expenditure history to prepare the financial statements of FTX.
He also shared that it will take some time for his team to properly locate all the fund transfers and expenditure history to prepare the financial statements of FTX.
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