Congressman Says FTX’s Sam Bankman-Fried Is A ‘Pathological Liar’

  • Congressman Ritchie Torres says Sam Bankman-Fried is a “pathological liar.”
  • According to Torres, the disgraced founder “misled the public” by claiming that FTX had enough assets to meet its obligations.
  • The harsh comments came two days after the disgraced founder was arrested in the Bahamas.

Congressman Ritchie Torres called Sam Bankman-Fried a “pathological liar” after mishandling billions of client funds. Torres said the disgraced founder “misled the public” by claiming that FTX had enough assets to meet its obligations.

“There’s evidence to show that much,” Torres, a member of the House Financial Services Committee, told Coindesk TV. “He lied because at no point after the crash, and even before that, FTX did not have enough liquidity to pay back all customer deposits.”

The exchange filed for bankruptcy protection last month after losing $8 billion in customer deposits. When a Coindesk report revealed that FTX’s native FTT token was used to support Bankman-Fried’s quantitative trading firm Alameda Research, the former billionaire took to Twitter to allay bankruptcy concerns.

Torres says Bankman-Fried continues to make “contradictory statements.”

“FTX is fine. Assets are fine,” Bankman-Fried said in a now-deleted tweet on November 7. “It’s tightly regulated, even if it slows us down. We have GAAP audits and over $1 billion in extra cash. We have a long history of protecting client assets, and that holds true today.”

Since then, numerous reports have revealed that Bankman-Fried knowingly used customer deposits to make risky bets through Alameda, and even reportedly engaged in a secret group chat that FTX insiders called “Wire Fraud.” The former Jane Street trader and MIT graduate attributed the problems to accounting errors, stating that he did not intentionally commit fraud or misappropriate assets.

Bankman-Fried was arrested on multiple charges in the Bahamas on Monday night.

“We argue that Sam Bankman-Fried built a house of cards on a foundation of deception while telling investors this is one of the safest buildings in crypto,” Gary Gensler, Chairman of the Securities and Exchange Commission, said in a statement Tuesday.

Congressman Torres received $2,900 in “unsolicited donations” from one of several lawmakers, Bankman-Fried, to see the executive’s contributions. The New York democrat says the money will go to a local charity.

“My ties to him are minimal,” Torres said of Bankman-Fried.

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