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US lawmakers slam use of Quickbooks, scary dough and ‘conscientious stupidity’

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Although Sam Bankman-Fried was nearly unable to attend his congressional hearing due to his recent arrest in the Bahamas, US lawmakers were spared no criticism of the former FTX CEO and the company’s business practices.

As the sole witness before the US House of Representatives Financial Services Committee hearing on December 13, FTX CEO John Ray shed light on several cryptocurrency exchange activities prior to his takeover as company chairman on November 11 and what subsequent investigations revealed. According to Ray, it was Alameda’s search Depends on funds from FTX trading – the international arm of the FTX Group – with “no internal controls and absolutely no separation” between the two companies.

The CEO of FTX testified that the owners of both Alameda and FTX—referring to Bankman-Fried—could “freely control” across most of the companies in the FTX group, with any separation more of a discrimination of the public rather than of reality. Responding to questions from Missouri Representative Ann Wagner, Ray added that FTX’s financial difficulties differ from high-profile failures like those at energy giant ENRON in that there are “absolutely no records” with numerous invoices and expense receipts running through Slack.

“[FTX] Use Quickbooks—a multi-billion dollar company uses Quickbooks,” Ray said. “Nothing against Quickbooks—a very good tool—not just for a multibillion-dollar company.”

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FTX CEO John Ray addresses the US House of Representatives Financial Services Committee on December 13

Several House members who spoke to the CEO of FTX questioned whether Bankman-Fried’s actions could have been deliberate or the result of gross incompetence. Wagner Put up an SBF “apology tour”. in the media after FTX’s bankruptcy, where he claimed he made “a lot of mistakes” in moving FTX users to Alameda.

“I don’t find any such statements credible,” Ray said.

Texas State Representative Al Green quoted Martin Luther King Jr. in an apparent attempt to understand Bankman Fried’s actions — “there is nothing in the world more dangerous than honest ignorance and conscientious stupidity” — and whether there were “irregularities” at FTX.

“Mr. Bankman Fried pretty much indicated that he had made a terrible mistake, and that he was doing everything he could to be a servant of great service to mankind,” said Green. “I find it hard to believe we are dealing with conscientious stupidity.”

Oklahoma representative Frank Lucas added:

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“Bankman-Fried obviously tried to pass himself off as the brightest of the shining, but being bright doesn’t make you an honest nor a fool, does it?”

Although Bankman Fried was not present to testify before the committee, lawmakers Confirm the contents of the written certificate swarm after his arrest. Missouri Representative Emanuel Cleaver called the SBF’s immediate use of profanity in his opening statement “disrespectful” and “totally insulting” to Congress. The lawmaker added that it would consider introducing a resolution to rename the cryptocurrency “scary dough currency” in light of recent events.

Related: New CEO says FTX was “a complete failure of corporate controls at every level of the organization”

The House Committee hearing was the second to explore FTX’s collapse after a December 1 hearing of the Senate Committee on Agriculture, in which CFTC Chairman Rustin Behnam was the only witness. CFTC and later the Securities and Exchange Commission Separate lawsuits have been filed against SBF, FTX, and Alameda for fraud.

The Senate Banking Committee has also scheduled a hearing for Dec. 14, with Hollywood star Ben McKenzie, investor Kevin O’Leary, law professor Hilary Allen, and Jennifer Scholpe, director of financial regulation studies at the Cato Institute Center for Monetary and Finance. Substitutes, appearing as witnesses. It is unclear if lawmakers will invite Bankman Fried to testify amid the current legal issues.