Monday, December 11, 2023

  • A new book by biographer Michael Lewis adds to allegations of mismanagement at the FTX crypto exchange.
  • Lewis’ account of FTX founder Sam Bankman-Fried’s rise and fall comes out Tuesday.
Crypto tycoon Sam Bankman-Fried saw billions of dollars in missing funds in his financial empire as a “rounding error,” biographer Michael Lewis told CBS’s 60 Minutes aired on Sunday.

As Bankman-Fried prepares to stand trial on fraud charges this week, Lewis, who has previously chronicled the Wall Street misdealings that led to the 2008 financial crisis, set out allegations of management failings at FTX – and a plot to pay off Donald Trump to stand down from his 2024 U.S. presidential ambitions.

The Department of Justice has accused Bankman-Fried of shifting customer funds from the FTX exchange to sister company Alameda Research, where they were used to fund his lavish lifestyle. Bankman-Fried has pleaded not guilty and appears to have downplayed the incident to Lewis.

Lewis said he asked Bankman-Fried how he was unaware “that $8 billion that’s not yours is in your private fund,” and received the reply that “when it went in there, it was a rounding error… it felt like we had infinity dollars in there… I wasn’t even thinking about it.”

Lewis also appeared to support allegations made by FTX’s new leadership, which took over on Nov. 11 when the company filed for bankruptcy, of poor corporate governance under Bankman-Fried’s tenure.

“Even his best friends, inside the company said, ‘Sam is just not built to manage people,’” Lewis said, adding that Bankman-Fried didn’t know the names of other members of the board of directors, and appears to have viewed their role as mere rubber-stamping.

Before FTX’s collapse, Bankman-Fried had also floated paying as much as $5 billion to Donald Trump to keep him from running for president again, added Lewis, whose book on Bankman-Fried comes out on Tuesday, the same day the fraud trial is scheduled to start.

Bankman-Fried “genuinely thinks he’s innocent,” added Lewis, who described FTX as a “great real business” that could have survived if bad publicity hadn’t led to a run on deposits.

Edited by Sandali Handagama.

#BankmanFried #Missing #FTX #Billions #Rounding #Error #Biographer

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