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FTX's founder Bankman-Fried says he failed to see warning signs - NYT

Published 11/14/2022, 08:40 PM
Updated 11/14/2022, 08:52 PM
© Reuters. FILE PHOTO: FTX CEO Sam Bankman-Fried poses for a picture, in an unspecified location, in this undated handout picture, obtained by Reuters on July 5, 2022. FTX/Handout via REUTERS

(Reuters) - FTX founder and former Chief Executive Sam Bankman-Fried said he expanded his business too fast and failed to notice signs of trouble at the exchange, whose downfall sent shock waves through the crypto industry, the New York Times reported late on Monday.

"Had I been a bit more concentrated on what I was doing, I would have been able to be more thorough," Bankman-Fried said in an interview with the newspaper.

FTX filed for bankruptcy on Friday, one of the highest-profile crypto blowups, after traders rushed to withdraw $6 billion from the platform in just 72 hours and rival exchange Binance abandoned a proposed rescue deal.

The U.S. Justice Department, the Securities and Exchange Commission and the Commodity Futures Trading Commission are now all investigating how FTX handled customer funds, a source told Reuters.

Bankman-Fried, who is based in the Bahamas, declined to comment on his current location, citing safety concerns, the newspaper said.

When asked whether FTX used customer funds to prop up the trading firm Alameda Research that he founded, Bankman-Fried told the New York Times that Alameda had accumulated a large "margin position" on FTX.

© Reuters. The logo of FTX is seen at the entrance of the FTX Arena in Miami, Florida, U.S., November 12, 2022. REUTERS/Marco Bello

"It was substantially larger than I had thought it was," he said and added without providing details that the size of the position was in the billions.

Reuters reported last week that Bankman-Fried had secretly transferred $10 billion of customer funds from FTX to Alameda.

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