The court filing of the SEC’s case against Sam Bankman-Fried (SBF) was released this morning. Attached and below is the filing with some initial observations.
Bob Bishop shared these observations with TGP this morning and on Twitter.
Though it was clear that the company could not make its payments, executives at FTX took out millions in personal loans. The company was involved in a variety of activities as well, including ‘yield farming.”
Bankman-Fried made numerous false claims that, even though he owned 90% of Alameda, he was not the ultimate decision-maker. In addition, FTX customer funds were comingled in Alameda, and the loan to Alameda was hidden on FTX’s balance sheet using an internal account labeled “fiat@FTX.com.”
(Hint: never comingle funds)
(5 of 9) FTX customer funds were comingled in Alameda, and the loan to Alameda was hidden on FTX’s balance sheet using an internal account labeled “fiat@FTX.com.” pic.twitter.com/AjbExkVJff
— Bob Bishop – Forensic Investigator (@BobBish40288847) December 13, 2022
The auditors of FTX appear to have some serious problems. National accounting firms Armanino and Prager Metis failed to document the FTX multi-billion loans to Alameda in the audited financial statements. They also missed related party transactions with FTX Executives. Massive audit failure.
(Bob Bishop is a retired auditor, he should know.)
Also, according to Bishop, Bankman-Fried committed perjury in testifying to Congress that FTX had a risk engine that mitigated client exposure. Will he get charged with lying to Congress like Roger Stone and others?