EN 
VI Mr. John J. Ray III, who took office as the new CEO of the exchange cryptocurrency FTX, said that never encountered such a serious bankruptcy.
On the evening of November 17, Mr. John J. Ray III, who agreed to sit in the “hot chair” at FTX, exchanges cryptocurrency filed for bankruptcy last week, submitted to the court a preliminary report on the company's situation.
Although he has experience in handling many corporate bankruptcies in the US, the best known of which is Enron Corporation, but the new CEO must admit from the beginning as follows:
“In my career, I have never witnessed such a complete failure of business management and such a lack of reliable financial information. From infringing on system integrity and legal oversight, to concentrating control in the hands of a small group of inexperienced and possibly malicious personnel, the current situation of company is unprecedented.”
THE FTX FIRST DAY DECLARATION
November 17, 2022
New CEO John Ray is scathing about Sam Bankman-Fried's management.
"Never in my career have I seen such a complete failure of corporate controls and such a complete absence of trustworthy financial information."https://t.co/iTGlCA9olr pic.twitter.com/Bd3Pjg4s7L
Other notable key points in Mr. John J. Ray III's report include:
– Former CEO Sam Bankman-Fried will be investigated.
– Funds Alameda Research loaned $2.3 billion to Sam Bankman-Fried's private company, $1 billion to Sam Bankman-Fried personally, $543 million to Chief Technical Officer Nishad Singh and to Ryan Salame (a senior manager). FTX senior) borrowed $55 million.
– FTX claims only $659,000 in assets left crypto, 1.1 billion USD stablecoins, $483 million in cash and other miscellaneous items. The floor's total assets are $2.2 billion, many times lower than the $9 billion figure given by Mr. Sam Bankman-Fried.
– Sam Bankman-Fried did not include user assets in the liability section of the balance sheet.
– FTX does not control cash flow centrally, does not have a list of specific bank accounts and owners.
– Mr. John J. Ray III recommends that the court should not use the previous financial statements of FTX as a basis for making an assessment, because the level of reliability is not high.
– Unable to get the list of personnel who have been working for FTX.
– FTX corporate assets have been used to purchase housing and provide for FTX employees and advisors.
– Management approves revenue and expenditure by “dropping emoji” on request messages from employees.
– FTX does not maintain books or records of digital asset management, instead it is all in the hands of Sam Bankman-Fried and Chief Technology Officer Gary Wang.
– FTX has many internal vulnerabilities such as using shared email to access private keys and sensitive information, not verifying data. blockchain on a daily basis, using software to conceal misuse of client funds, having a “secret mechanism to prevent Alameda from being liquidated on FTX” and no separation of management between FTX and Alameda.
