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We might find out more here

“The full story here is one I’m still fleshing out every detail of, but as a very high level, I fucked up twice,” he tweeted. “The first time, a poor internal labeling of bank-related accounts meant that I was substantially off on my sense of users’ margin. I thought it was way lower.”

Bankman-Fried basically chalked this catastrophic error up to a mistake, and said it was a learning experience “which tells me a lot of things, both specifically and generally, that I was shit at.” He went on to explain that this situation “sucks, and that’s on me. I’m sorry.”

That’s possible, of course it is. I tend to think we’ll find out it was more than that though.

Ah, yes, here we are:

FTX Chief Executive Sam Bankman-Fried told an investor this week that Alameda owes FTX about $10 billion, the person said. FTX extended loans to Alameda using money that customers had deposited on the exchange for trading purposes, a decision that Mr. Bankman-Fried described as a poor judgment call, according to the person.

Lending client money to yourself to gamble is more than that.

As questions were brewing about FTX’s health on Monday, Mr. Bankman-Fried tweeted: “FTX has enough to cover all client holdings. We don’t invest client assets (even in treasuries).” He later deleted the tweet.

Well, yes, quite.

All in all, FTX had $16 billion in customer assets, according to the person, so FTX lent more than half of its customer funds to its sister company Alameda.


8 thoughts on “We might find out more here”

  1. The caption on his Wikipedia page picture has been altered (at least now) to name him as “Scam Bankrun-Fraud.”
    For what it’s worth…

  2. Also at WKPD: “he is the son of Barbara Fried and Joseph Bankman, both professors at Stanford Law School.”

    Good-oh; free legal advice. Maybe they keep a list of countries with which the USA doesn’t have an extradition agreement.

  3. I have a copy of “The Notebooks of Lazarus Long”

    It has a pithy quote about going bust for millions v/s, and .. Stuff..

    I bet one beer mr. Bankman-Fried won’t miss a breakfast..

  4. From wikipedia:

    Bankman-Fried has stated he is a supporter of effective altruism and claims to pursue earning to give as an altruistic career. He is a member of Giving What We Can and has claimed that he plans to donate the great majority of his wealth to effective charities over the course of his life.

    The louder the virtue-signalling, the dodgier the geezer.

  5. Fortunately, I don’t he has to worry about consequences for his ‘mistake’…
    His mother, Barbara Fried, runs a Political Action Committee called Mind-The-Gap which gave approx. $140 million to Sleepy Joe’s campaign in 2020.
    Mr Bankman-Fried himself donated $5.2 million to the Biden campaign.

  6. “Mr Bankman-Fried himself donated $5.2 million to the Biden campaign.”

    Imagine the outrage if Trump had received funds from someone who subsequently went spectacularly bankrupt owing billions to clients. All the usual suspects would be screaming blue murder and demanding he pay it back etc etc. But no-one will demand Biden pay a cent back to the receivers I’m sure.

  7. “Mr Bankman-Fried himself donated $5.2 million to the Biden campaign.”

    According to Politico, he shovelled nearly ten times that to Democrat candidates during the midterms. Apparently it makes him their second-biggest donor. So what Jim said.

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