Lawmakers are calling on FTX's Sam Bankman-Fried to testify or be subpoenaed: 'The American people need answers'

• The Senate Banking Committee says if FTX founder Sam Bankman-Fried doesn't testify next week, it will subpoena him.
• "FTX's collapse has caused real financial harm to consumers," the Senate Banking Chair said in a statement.

The Senate Banking Committee is calling on FTX founder Sam Bankman-Fried to voluntarily testify in front of lawmakers next Wednesday or they will subpoena him.

In a letter signed by Senate Banking Chairman Sherrod Brown, the lawmaker gave the disgraced founder until Thursday at 5:00 pm to discuss his "participation at the hearing."

"As the Founder and CEO of FTX Trading Ltd. at the time of its collapse and the founder, principal owner, and former CEO of Alameda Research, you must answer for the failure of both entities that was caused, at least in part, by the clear misuse of client funds and wiped out billions of dollars owed to over a million creditors," Brown said in a public statement to the former billionaire on Tuesday. "There are still significant unanswered questions about how client funds were misappropriated, how clients were blocked from withdrawing their own money, and how you orchestrated a cover up."

Brown added: "If you chose not to appear, I am prepared, along with Ranking Member Pat Toomey, to issue a subpoena to compel your testimony."

US Securities and Exchange Commission (SEC) chair Gary Gensler this week called on crypto platforms and intermediaries to "come into compliance" or face the regulator's wrath as well after the FTX fiasco.

"The runway is getting shorter," the SEC chief said in a Yahoo Finance interview on Wednesday, adding that the agency is "already suited up."

"We brought actions against crypto lending platforms including BlockFi, and we will continue to be a vigorous securities regulator, but I really do suggest to these intermediaries, these storefronts, these casinos, if you wish, to come into compliance, work with the SEC to get into compliance, disaggregate these businesses," Gensler said.

Bankman-Fried did not respond to Insider's request for comment, but has maintained in public statements that he did not intentionally commit fraud.

The now defunct-crypto exchange filed for bankruptcy last month amid a severe liquidity crunch spurred by reports of murky ties to sister firm Alameda Research. The trading shop was reportedly using FTX customer deposits to take risky bets, and was significantly propped up by FTX's native FTT token.

"FTX's collapse has caused real financial harm to consumers, and effects have spilled over into other parts of the crypto industry. The American people need answers about Sam Bankman-Fried's misconduct at FTX," Senators Pat Toomey and Brown said in a prepared statement. "The Committee has requested that he testify at our upcoming hearing on FTX's collapse, and will consider further action if he does not comply."