Facing criminal charges for fraud, money laundering, and campaign finance violations, the founder and former-CEO of FTX, Sam Bankman-Fried, responded at length to the accusations against him on Thursday, January 12, claiming that "no funds were stolen" during the collapse of FTX.
Much of what Bankman-Fried wrote in his "Pre-Mortem Overview", posted on Substack, reiterates statements he's made that have already been discounted by industry experts, according to The New York Times.
Alongside a detailed timeline of Alameda's financial outlook leading up to FTX's collapse, Bankman-Fried argued that the fund's failure was the result of unforeseen market crashes. He also suggested that Binance's attempted purchase of FTX also contributed to the platform's implosion.
"I didn't steal funds, and I certainly didn't stash billions away," the former crypto mogul wrote. "Nearly all of my assets were and still are utilizable to backstop FTX customers."
Several of Bankman-Fried's other key points revolve around a recent announcement that the lawyers overseeing FTX's bankruptcy had recovered $5 billion in seized funds. Previously, FTX's attorneys had estimated that the company's seized assets were worth as little as $170 million.
Bankman-Fried claimed the $5 billion recovery shows that FTX had been prematurely "pressured" into filing for bankruptcy despite holding "significant assets", and that FTX deposits could still be "substantially" recovered.
"I believe that, had FTX International been given a few weeks, it could likely have utilized its illiquid assets and equity to raise enough financing to make customers substantially whole," Bankman-Fried wrote. "Even now, I believe that if FTX International were to reboot, there would be a real possibility of customers being made substantially whole."
Neither the attorneys for FTX or Sam Bankman-Fried responded to journalists' requests for comment on the former-CEO's post. The post doesn't include any statements suggesting it was approved by Bankman-Fried's legal team, and legal experts say that it probably wasn't his attorney's idea.
"The most powerful evidence a prosecutor can have is the defendant's own words, and Bankman-Fried is giving the government a gift," former federal prosecutor Moira Penza told The New York Times. "If I were prosecuting the case, I would want him to keep talking, and if I were defending him I would be telling him to shut his mouth."
Immediately following FTX's collapse, Bankman-Fried went on a media tour to answer questions about his role in the platform's failure. After his arrest and subsequent release on bail, he's stayed comparatively silent, until now.
According to Bankman-Fried, he would have preferred to give his detailed statement earlier.
"I had been planning to give my first substantive account of what happened in testimony to the U.S. House Financial Services Committee on December 13th," Bankman-Freid wrote. "Unfortunately, the DOJ moved to arrest me the night before, preempting my testimony with an entirely different news cycle."
In his statement, Bankman-Fried didn't acknowledge that two of his former top executives, Caroline Ellison and Gary Wang, have both plead guilty to charges regarding FTX's collapse and are now cooperating with prosecutors. Ellison was the head of Alameda, and Wang was Bankman-Fried's co-founder at FTX.
"I have a lot more to say-about why Alameda failed to hedge, what happened with FTX U.S., what led to the Chapter 11 process, S&C, and more," Bankman-Fried's post reads. "But at least this is a start."