A bankruptcy lawyer says FTX spent $300 million buying houses for senior executives.
The founder of FTX ran the exchange like his own personal fiefdom and spent a lot of money on things not related to the business, according to a Sullivan & Cromwell partner.
He said during the first day of the trial that one of the US arms of the company bought $300 million worth of real estate in the Bahamas.
Most of the real estate purchases were related to homes and vacation properties used by senior executives of the company.
John J. Ray III had previously accused the FTX Group of using corporate funds to purchase homes and other personal items for employees and advisors.
Attorneys for FTX outlined the dire state of the business at a Tuesday hearing. According to the Wall Street Journal, FTX lent $10 billion to Alameda.
One of the most difficult collapses in the history of corporate America has been seen by us.
A small group of inexperienced and unsophisticated individuals ran the company. He said that the companies had unreliable books and records.
He said that the organization was run as a personal fiefdom of Sam Bankman- Fried. None of us in the profession have seen a lack of corporate controls like that before.
There have been resignations throughout the ranks since the exchange collapsed. Gary Wang and the director of engineering have left the company after Bankman- Fried resigned as CEO.
At the end of October, the FTX Group had 520 employees, of which 330 are in the US. He said that the latter fell to around 260.
"We are trying to bring order to the chaos."
Bankman-Fried splashed out money on the company's staff after FTX collapsed. Bankman- Fried said he was building up his fortune with the plan to give most of it away.
Everyone has been allowed to see under the covers and see that the emperor had no clothes.
FTX filed for Chapter 11 protection last week after it was plunged into a solvency crisis by its rival exchange. The value of FTT has fallen in the last few months.
Ray slammed Bankman-Fried and other senior executives in a Chapter 11 filing, where he said that FTX was audited by an accounting firm with an office in the metaverse.
A group of lawyers are trying to find FTX's assets so they can repay their debts. According to Ray, the company would reorganize or sell its assets around the world and had already received interest from potential buyers.
The situation is worse than people thought. Here are the craziest details of the case.
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