Bahamian Regulator Accuses John Ray of ‘Misstatements’ Regarding FTX

Liquidation veteran John Ray has intentionally misrepresented Sam Bankman-Fried’s relationship with Bahamian regulators, the Commission said

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The Securities Commission of the Bahamas has accused new FTX CEO John Ray of making “misstatements” in order to “advance questionable agendas” related to the exchange’s restructuring. 

Liquidation veteran Ray has intentionally made misrepresentations relating to Sam Bankman-Fried’s relationship with the Bahamas regulatory authorities, the Commission alleged in a statement released Tuesday. 

Ray released redacted emails between Bankman-Fried and Bahamian officials as part of the exchange’s bankruptcy filings. In the correspondence, Bankman-Fried tells officials that the exchange has “segregated” funds belonging to Bahamian customers and offered to open withdrawals for these clients only. 

“Those redactions were designed to create a false impression of communications between Mr. Bankman-Fried and the Commission,” the Securities Commission of the Bahamas wrote in Tuesday’s statement. “These redactions are disturbing as Mr. Ray is aware that the full email reveals Mr. Bankman-Fried’s acknowledgement that he had ‘not briefed the Securities Commission.’” 

The Commission’s statement comes less than 24 hours after Bankman-Fried was arrested in the Bahamas. Bahamian officials cooperated with the US in detaining the disgraced founder, who faces charges of money laundering and wire fraud in the US. 

The letter came as Ray appeared on Capitol Hill Tuesday to address lawmakers and provide insight into how the exchange failed. 

Ray made several accusations in his prepared testimony regarding the exchange’s business operations. He said the restructuring team has discovered FTX was commingling funds and inappropriately stored certain private keys “to access hundreds of millions of dollars in crypto assets without effective security controls or encryption,” according to his opening statement.

As of Tuesday, Ray has not responded to the Bahamian regulator, officials added in the statement.


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