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Two congressional hearings will be held next week on the collapse of cryptocurrency exchange FTX, and US lawmakers have asked former FTX CEO Sam Bankman-Fried (SBF) to testify. As the founder of FTX and Alameda Research, “you must answer for the failure of both entities that was at least in part caused by clear misappropriation of client funds and wiped out billions of dollars owed to over a million creditors,” Senator Sherrod Brown told Bankman-Fried.
The House Committee on Financial Services and the Senate Committee on Banking, Housing and Urban Affairs are holding separate hearings on the collapse of crypto exchange FTX next week.
U.S. Senator Sherrod Brown (D-Ohio), chairman of the Banking, Housing and Urban Affairs Committee, on Wednesday sent a letter to former FTX CEO Sam Bankman-Fried (SBF) asking him to attend the committee’s hearing titled “Crypto Crash: Why the FTX Bubble Burst and the Harm to Consumers” which takes place on December 14. The letter states:
As founder and CEO of FTX Trading Ltd. at the time of the collapse and founder, principal owner and former CEO of Alameda Research, must answer for the failure of both entities which was at least in part caused by clear misappropriation of client funds and wiped out billions of dollars owed to over a million creditors.
“There are still significant unanswered questions about how client funds were misused, how clients were blocked from withdrawing their own money, and how you orchestrated a cover-up,” the senator continued.
Brown explained that “Traditionally, witnesses who are invited to appear before the committee volunteer.” He asked Bankman-Fried to respond to his staff by 5 p.m. EST Thursday to discuss his participation in the hearing.
The legislator warned:
If you choose not to appear, I am prepared, along with Ranking Member Pat Toomey, to issue a subpoena to compel your testimony.
FTX filed for bankruptcy on November 11 and Bankman-Fried resigned as CEO. The company is now being investigated for mishandling customer funds. FTX’s new CEO, John Ray, told the bankruptcy court, “Never in my career have I seen such a complete failure of corporate controls and such a complete absence of reliable financial information as occurred here.”
Meanwhile, Rep. Maxine Waters, chair of the House Committee on Financial Services, invited Bankman-Fried to attend the committee’s hearing on December 13. She has tweeted at the FTX co-founder several times, but has not issued a subpoena for him to testify.
The congresswoman has been heavily criticized for her polite approach to inviting Bankman-Fried. She even tweeted that she appreciated him being honest in his discussions about what happened to FTX. Waters tweeted on Wednesday:
Lies are circulating @CNBC that I am not willing to subpoena @SBF_FTX. He has been asked to testify at the hearing on December 13. A subpoena is definitely on the table. Watch.
Bankman-Fried told Waters last week that he will testify when he is “done learning and reviewing what happened,” which he doesn’t expect to happen by Dec. 13.
Do you think US lawmakers will be able to get Sam Bankman-Fried to testify at congressional hearings next week? Let us know in the comments section below.
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