The new management team at FTX, the bankrupt cryptocurrency exchange, has released an initial report on what led to the company's failure under ousted founder and CEO Sam Bankman-Fried. The report paints a negative picture of the former leadership, citing hubris, incompetence, and greed as root causes of the collapse. The report also claims that FTX was tightly controlled by a small group of individuals who showed little interest in instituting an appropriate oversight or control framework. These individuals are accused of commingling and misusing corporate and customer funds, lying to third parties about their business, and joking internally about their tendency to lose track of millions of dollars in assets. The report says that FTX and its affiliated entities lacked the appropriate management, governance, and organizational structure necessary for its size, as well as the financial and accounting controls needed for a multibillion-dollar firm. Several former FTX and Alameda executives are currently facing federal charges related to the companies' failures, which resulted in tens of billions of dollars of losses to customers. Bankman-Fried has pleaded not guilty to all 13 federal counts against him and remains on house arrest at his parents' California home on a $250 million bond until his trial, which is slated for October. The FTX debtors said further reports are forthcoming as they continue their probe.
Report attributes FTX collapse to hubris, incompetence, and greed