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Sam Bankman-Fried tries to skip US Congress hearing

FTX, Sam Bankman-Fried

Economy

Sam Bankman-Fried tries to skip US Congress hearing

Former CEO of fraudulent crypto venture FTX, Sam Bankman-Fried replied to a invitation from the US Congresswoman Maxine Waters on Twitter saing he is “not sure” he will be ready to participated in a scheduled December 13 hearing in Washington DC as he currently is in Bahamas.

According to media reports, Sam Bankman-Fried was called to testify before the US Congress Financial Services Committee. The committee’s ranking member, Representative Maxine Waters, tweeted to Bankman Fried that “we would welcome your participation in our hearing” on Capitol Hill.

“We appreciate that you’ve been candid in your discussions about what happened at #FTX”, the Congresswoman wrote. “Your willingness to talk to the public will help the company’s customers, investors, and others”.

In response, Sam Bankman-Fried wrote:

“Once I have finished learning and reviewing what happened, I would feel like it was my duty to appear before the committee and explain. I’m not sure that will happen by the 13th. But when it does, I will testify”.

FTX collapse is becoming biggest financial scandal of 2022, which involves US politicians, Democratic Party and several celebrities such as Tom Brady, Steph Curry and other major endorsers of the now bankrupt cryptocurrency exchange. Although Bill Clinton was amongst the front-ranging endorsers and even promoters of this notorious scam, there is yet to be any investigation on his involvement.

According to media reports, the director of enforcement for the Texas State Securities Board has announced that state regulators are investigating multiple celebrity endorsers tied to the FTX trading platform. The probe is an effort to determine whether securities laws were violated by Brady, Curry and others while promoting FTX and cryptocurrency.

Texas regulators have begun corresponding with securities regulators in other states, and that parallel state investigations into celebrity endorsers could be announced in the coming weeks or months, a source familiar with the investigation told Yahoo Sports on November 21, 2022.

“The expectation is there will likely be a comprehensive review by many regulators across the country, depending on what securities or consumer protections might apply in other states,” the source said. “[Texas] isn’t likely to stand alone”.

Asked whether state probes could be the first steps toward an eventual federal securities investigation involving Brady and other celebrity endorsers, the source added, “That’s certainly not anything the state of Texas can influence, but it’s sensible that what is happening with FTX will occupy the attention of federal regulators at the appropriate time”.

The scrutiny of Texas state regulators comes in the wake of the trading platform collapsing earlier this month, which included freezing billions of dollars in customer accounts while founder Sam Bankman-Fried moved the company into bankruptcy protection. The total asset losses by FTX customers are still unknown, although various reports have pegged the platform’s financial shortfall at US$8 billion to US$12 billion — or possibly much more. A handful of hedge funds that were invested in the platform have already notified investors of potential losses, including venture capital fund Sequoia Capital, which reportedly apologized to its partners this week for US$150 million in anticipated losses tied to FTX.

What all of this means for Brady, Curry and a swath of other celebrity endorsers is still taking shape. But the director of enforcement for the Texas State Securities Board, Joe Rotunda, told Bloomberg this week that payments and equity received by Brady and others will be under the microscope, including their disclosures and agreements with the company. At the heart of the review for regulators — both state and federal — will be what aspects of the FTX exchange qualify as “securities,” making them applicable to various securities laws. Historically, securities violations involving endorsers are subject to potentially significant financial fines rather than criminal convictions involving jail time.

News Desk

Contents published under this byline are those created by the news team of BLiTZ

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