Sam Bankman-Fried presented risk model to FDIC for FTX before the collapse!

Prior to the collapse of FTX, Sam Bankman-Fried's intention to have the exchange regulated federally emerged from an email exchange with a top regulator

by Lorenzo Ciotti
SHARE
Sam Bankman-Fried presented risk model to FDIC for FTX before the collapse!

Prior to the collapse of FTX, Sam Bankman-Fried's intention to have the exchange regulated federally emerged from an email exchange with a top regulator. We recall recently court documents revealed that SBF and five other former executives of FTX and Alameda Research, received $3.2 billion in payments and loans from FTX-related entities.

SBF reportedly received the bulk of the funds, an estimated $2.2 billion. On May 28, 2022, nearly six months before FTX filed for bankruptcy and SBF stepped down as CEO, Martin Gruenberg, president of the Federal Deposit Insurance Corporation, received an invitation to meet with SBF on June 13, 2022, the Washington Examiner reported.

The email was brokered by former CFTC commissioner Mark Wetjen, who joined FTX US in November 2021 as head of regulatory policy and strategy. In the last part of the email, Wetjen told Gruenberg that FTX is in the unusual position of pleading with the federal government to regulate it.

He then added: "We have submitted an application to the CFTC explaining to the agency how to do this. The CFTC just has to approve it. Once the CFTC approves it, the others will follow — other major US exchanges are also licensed by the CFTC”.

In response to SBF's request, Gruenberg agreed to meet with the duo. Following the collapse of FTX, SBF's political ties were uncovered in parallel investigations. An FDIC spokesperson confirmed that the FDIC chairman met with SBF as part of routine courtesy visits with leaders of businesses and financial institutions.

In addition to the aforementioned amounts, $587 million was also transferred to Nishad Singh, $246 million to Zixiao Gary Wang, $87 million to Ryan Salame, $25 million to John Samuel Trabucco and $6 million to Caroline Ellison.

Singh, Wang and Ellison have all admitted to various types of fraud, have pleaded guilty and are actively cooperating with prosecutors in hopes of getting a lesser sentence. Bankman-Fried's $250 million bail has come under scrutiny, especially following the revelation that he had attempted to contact possible witnesses during the trial.

Sam Bankman-fried Ftx
SHARE