Sam Bankman-Fried reportedly joked about losing track of assets worth millions of dollars
- Sam Bankman-Fried joked about losing track of millions of dollars in assets, a debtors' report said.
- The former FTX CEO said the company sometimes found "$50m of assets lying around."
Sam Bankman-Fried joked about Alameda Research losing track of assets worth millions of dollars, FTX debtors said in a report filed Sunday.
The report, filed in the US Bankruptcy Court for the District of Delaware, alleged that the failed crypto empire was "tightly controlled by a small group of individuals," who "joked internally about their tendency to lose track of millions of dollars in assets."
In an internal communication cited in the report, Bankman-Fried once said FTX's sister company Alameda Research was "hilariously beyond any threshold of any auditor being able to even get partially through an audit."
He said: "Alameda is unauditable. I don't mean this in the sense of 'a major accounting firm will have reservations about auditing it'; I mean this in the sense of 'we are only able to ballpark what its balances are, let alone something like a comprehensive transaction history'.
"We sometimes find $50m of assets lying around that we lost track of; such is life."
According to the report, Alameda struggled to understand what its own positions were, "let alone hedging or accounting for them." In one example referenced in the report, employees were told by an unidentified manager in June 2022 to just "come up with some numbers? Idk."
The document accused the individuals in charge of FTX and Alameda of showing "little interest in instituting an appropriate oversight or control framework." This inner circle reportedly included Bankman-Fried, FTX cofounder Gary Wang, former Alameda CEO Caroline Ellison, and FTX's former engineering director Nishad Singh.
Although Bankman-Fried was said to have the final say in company decisions, one FTX executive was quoted in the report as stating that "if Nishad got hit by a bus, the whole company would be done. Same issue with Gary."
Singh and Wang have pleaded guilty to charges and are cooperating with authorities, while Bankman-Fried has pleaded not guilty to fraud.
Representatives for Bankman-Fried declined to comment. FTX did not immediately respond to a request for comment from Insider.