"We sometimes find $50 million of assets lying around that we lost track of; such is life."
According to yet another shocking report, disgraced cryptocurrency exec Sam Bankman-Fried and his collaborators thought it was hilarious that they were unable to look after million-dollar assets.
As quoted in a new debtors' report filed over the weekend in the US Bankruptcy Court for the District of Delaware, SBF's collapsed 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."
This small group of individuals, which included Bankman-Fried, FTX cofounder Gary Wang, and former Alameda Research CEO Caroline Ellison, showed "little interest in instituting an appropriate oversight or control framework," according to the report.
Bankman-Fried and his collaborators' carelessness sounds considerable.
"We sometimes find $50 million of assets lying around that we lost track of; such is life," he said, according to the report.
SBF oversaw crypto exchange FTX, which collapsed in the most spectacular fashion possible last year, wiping out a $32 billion valuation in a matter of days and sending shockwaves throughout the crypto industry.
Now details about the fallen empire, as well as its sister trading firm Alameda Research, are emerging as prosecutors build out a case. Revelations paint a seriously troubling picture of the two companies' operations, which were based in the Bahamas at the time.
The sheer degree of mismanagement was seemingly apparent to Bankman-Fried, who once claimed that Alameda Research was "hilariously beyond any threshold of any auditor being able to even get partially through an audit," according to internal communication cited in the report.
"Alameda is unauditable," he allegedly said. "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.'"
Despite a monumental amount of evidence, Bankman-Fried pleaded not guilty to fraud back in January. He is now awaiting an October trial while under house arrest at his parents' mansion in Northern California, after posting a $250 million bail.
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