FTX’s former CEO, Sam Bankman-Fried, appeared in court on Tuesday with his newly hired lawyer Mark Cohen, the attorney who also represented Ghislaine Maxwell during her sex-trafficking trial, and his legal team that sought to have her released on $250,000 bail.
In addition, Joseph Bankman and Barbara Fried, both parents of SBF, had attended the court hearing. SBF’s mother allegedly laughed out loud whenever her son was called a “runaway” and his father put his fingers in his ears.
In fact, although SBF had previously stated that his parents were never involved in FTX’s dealings, according to reports by the New York Times Joseph Bankman was a paid FTX employee who frequently traveled to the Bahamas. The NYT report also states that the parents of SBF have become somewhat of a subject of gossip on Stanford’s campus.
Notably, when asked, a former dean at Stanford and a close friend of the Bankman-Fried family told the NYT reporter, “I had a friend who said, ‘You don’t want to be seen with them,’”
According to The Bitcoinist, Cohen was quoted while saying that his client had been suffering from depression, insomnia, and ADD for over a decade. During the hearing, prosecutors argued that SBF was essentially a flight risk because of all the financial connections he has. However, Judge Ferguson-Pratt was unimpressed by the claims that SBF was suffering from alleged mental problems and the fact that SBF had surrendered his passport.
Judge Ferguson-Pratt told the court that bail had been refused and that SBF would remain in custody until his court hearing on February 8, 2023. After the decision, the New York Post reported that SBF bowed his head, and hugged his parents before being led out of the courtroom in handcuffs.
On another occasion, Kevin O’Leary, an investor, and judge on Shark Tank who was paid $15 million to act as a spokesman for FTX testified before the Senate Banking Committee on Wednesday about the collapse of the crypto exchange.
O’Leary was among a group of celebrities, who were sued by FTX investors for promoting the firm. Notably, celebrities like Tom Brady and Larry David were also part of the group. O’Leary stated that he put roughly $9.7 million into crypto from the $15 million deal. According to him, the rest went to taxes and agent fees.
When he was asked about his accounts that were stripped of all of their assets and accounting and trade information, the Shark Tank investor said that he could not get straight answers from any of the executives in the firm so he simply called Sam Bankman-Fried and said, ‘Where is the money, Sam?’”.
According to him, only then did he discover that Bankman-Fried had spent between $2 billion and $3 billion repurchasing shares from Binance CEO Changpeng Zhao, who held 20 percent ownership in Bankman-Fried’s firm.
O’Leary said that he had asked Bankman-Fried what would compel him to do that. The founder responded that Zhao would not comply with regulators’ requests for data that would allow the firm to obtain a license. The founder reportedly told O’Leary that the “only option” was to buy FTX from Zhao at a tremendous valuation of about $32 billion.
According to O’Leary, that stripped the balance sheet of assets. He also added that those who are asking him about why the firm went bankrupt should follow what unfolded last week. He mentioned how all of a sudden CZ is asking for another $500 million in social media. According to him, CZ either wants to do a block trade of FTT or the proprietary token of FTX. CZ wants to transform it back to fiat. He asked why would anyone put that out there when we all knew it was going to push down the value of that coin dramatically. According to O’Leary, that is exactly what happened in the end.
“Now, maybe there’s nothing wrong with that,” he said. He added saying that there might be nothing wrong with love and war. However, Binance is a tremendously unregulated global monopoly now. They successfully managed to put FTX out of business.
It is important to note that the Securities and Exchange Commission (SEC) has formally charged FTX founder and former CEO Sam Bankman-Fried for defrauding its investors a day after his arrest in The Bahamas.
Moreover, many stories have been emerging day by day such as the chief engineer of FTX making a secret change to the cryptocurrency exchange’s software or the former Almeda Research CEO being ready to backstab SBF.
Whether they are merely rumors or events that have actually occurred, the court will do its best to try to find out what caused the crash of the crypto exchange and hopefully, it will restore faith in the crypto space again.
Source- Unlock. Media