Finance

Crypto investors who lost big in FTX crash protest Bankman-Fried appearance

Andrew Ross Sorkin speaks with FTX founder Sam Bankman-Fried during the New York Times DealBook Summit in the Appel Room at the Jazz At Lincoln Center on November 30, 2022 in New York City. The New York Times held its first in-person DealBook Summit since the start of the coronavirus (COVID-19) pandemic with speakers from the worlds of financial services, technology, consumer goods, private investment, venture capital, banking, media, public relations, policy, government, and academia. (Photo by Michael M. Santiago/Getty Images)

NEW YORK — FTX founder Samuel Bankman-Fried’s interview at a financial conference here Wednesday drew a crowd of protesters, some of whom had lost sizable portions of their life savings in the collapse of his crypto platform FTX earlier in November.

“This guy robbed me,” said Anthony Canelo, who stood outside the event hosted by the New York Times, where Bankman-Fried spoke via video link from the Bahamas.

Canelo held a sign that read “SBF and Gary G robbed us all,” referring to Bankman-Fried as well as U.S. Securities and Exchange Commission Chair Gary Gensler, who has been under pressure to clamp down on the loosely regulated cryptocurrency sector.

“I lost over $10,000. I’m 36-years-old. Do you know how much money that is for someone like myself? And this guy gets to talk? Everyone knows that he took customer funds,” Canelo added.

“If you look at it, this is a classic scam,” he continued. “You have opaqueness of books, you have a so-called charismatic leader, you have top-tier sponsors. This is outrageous that he’s even allowed to speak here.”

Bankman-Fried was interviewed during the event by New York Times reporter and CNBC host Andrew Ross Sorkin, who said he’d received numerous letters from people who’d experienced financial hardship from the collapse and were angry the FTX founder was being given a high-profile platform to explain himself.

“One of the letters I got I want to read to you, Sam, because it’s from a gentleman who said he lost his life savings,” Sorkin said. “It says, ‘Andrew, can you please ask [Samuel Bankman-Fried] why he decided to steal my life savings and the $10 billion more from customers to give to his hedge fund?”

Bankman-Fried said he was “deeply sorry about what happened” but said he “didn’t ever try to commit fraud on anyone.”

Nonetheless, questions are swirling now about loans made from FTX to one of Bankman-Fried’s other companies, Alameda Research, before FTX was discovered to have solvency issues and problems paying back its regular customers.

This has led to public anger over FTX’s service agreement with customers, which stipulates that customers’ digital assets don’t belong to the FTX platform and can’t be treated as such.

“So how is it possible that Alameda had this loan of such a large size?” Sorkin asked Bankman-Fried.

The one-time crypto billionaire responded that other parts of the company’s service agreement, such the one pertaining to the company’s borrowing and lending facility, could have allowed for such a loan to take place.

Still, Bankman-Fried conceded that a “massive failure of oversight of risk management” had occurred.

That was little consolation to people who lost money during the collapse of FTX.

“He robbed, he took customer funds and sent himself a loan for a billion [dollars], sent his colleagues money,” Canelo said outside the event. “He bought his parents $121 million worth of real estate so that they could wash their money clean. This is outrageous.”

Bankman-Fried addressed the issue of real estate that was bought for his parents during the conference.

“I don’t know the details of the house for my parents, but I knew it was not intended to be their long-term property. It was intended to be the company’s property.” he said. “I think they stayed there while working with the company some time over the last year.”

Tags Andrew Ross Sorkin Andrew Ross Sorkin FTX Gary Gensler New York Times Sam Bankman-Fried
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