Disgraced FTX founder Sam Bankman-Fried ignored pleas from company attorneys and advisers urging him to file for bankruptcy “for days” before the cryptocurrency platform imploded, according to a report Tuesday.
FTX general counsel Ryne Miller was one of several people who begged Bankman-Fried and other executives to relinquish their control of the company, the New York Times reported, citing internal emails and text messages.
The mood grew so dire that the FTX attorneys purportedly tried to contact Bankman-Fried’s father, Stanford Law professor Joseph Bankman, to see if he would intervene and speak to his son.
In the early morning hours of Nov. 11, the day FTX filed for bankruptcy, Miller was still begging Bankman-Fried to sign the necessary paperwork.
“Please can you sign the document,” Miller purportedly wrote in a message at 2:29 a.m.
The messages highlighted the chaos within FTX as it fell from industry leader to pariah in a matter of hours. Bankman-Fried faces intense legal and regulatory scrutiny over FTX’s collapse and his own actions while allegedly pillaging company resources for non-business spending.
Prior to the filing, Bankman-Fried continued to insist behind the scenes that he could steer the platform out of its inevitable financial ruin – even after rival platform Binance backed out of a deal to buy FTX due to concerns about its finances.
An FTX attorney first urged the company’s top brass to appoint John Ray III to oversee its bankruptcy on Nov. 9, according to the report. Ray, who is currently serving as FTX CEO, is best known for steering disgraced energy firm Enron through its bankruptcy.
Hours before the bankruptcy filing occurred, Bankman-Fried was still telling FTX workers that he was pursuing outside funding to keep the platform afloat.
On Nov. 10 – one day before the bankruptcy filing – Miller reportedly emailed Bankman-Fried and other top FTX officials urging them to immediately pause activity on the cryptocurrency platform. In the message, Miller lamented that the “founding team is not currently in a cooperative posture.”
When FTX officials made a mistake in the bankruptcy filing by accidentally listing entities that were not under FTX Group’s control, Miller purportedly blamed the error on Bankman-Fried and his close associates.
“We had no cooperation of the founders in preparing this week,” Miller said. “It was unfortunate.”
Miller was also responsible for FTX’s move to scrub executive bios from the company’s “about” page.
As The Post has reported, bios for Bankman-Fried, fellow co-founder Gary Wang, former chief regulatory officer Dan Friedberg and others abruptly disappeared in recent days after the company went bankrupt.
“Who can go to FTX.com and FTX US and remove the pictures and bios of the people under ‘about,’” Miller said in a group message to other executives, according to the report.
Bankman-Fried declined to comment on the text messages he exchanged with other FTX executives prior to the bankruptcy, the New York Times reported.
However, the former executive claimed that he had identified “numerous parties” who were interested in providing a cash infusion even after bankruptcy proceedings were underway.
Miller and FTX reportedly declined to comment on the situation.
FTX formally filed for Chapter 11 bankruptcy on Nov. 11 as the company’s financial situation became untenable. Bankman-Fried broke the news with an apology via tweet.
“I’m really sorry, again, that we ended up here.” Bankman-Fried said. “Hopefully things can find a way to recover. Hopefully this can bring some amount of transparency, trust, and governance to them. Ultimately hopefully it can be better for customers.”
Bankman-Fried reversed course just a few days later, telling a Vox reporter that he regretted the bankruptcy and describing the move as his “biggest single f—kup.”
Meanwhile, Ray and other members of FTX’s current team of stewards excoriated Bankman-Fried in court filings, accusing him of running the company as if it were a “personal fiefdom” without any corporate governance standards in place.
Late Tuesday, Bankman-Fried was ordered to appear at a hearing on Feb. 2 by a Texas regulator regarding a claim that FTX US offered unregistered securities products through its yield-bearing service.
