FTX committed ‘old fashioned embezzlement, says new CEO John J Ray III

• FTX’s CEO testified before House Financial Services Committee on Tuesday.

• John J Rau III faulted FTX’s operations, resulting in the exchange’s collapse.

• SBF has been charged with eight criminal counts by the U.S. Attorney’s Office for the Southern District of New York.

FTX was using QuickBooks to track its portfolio

FTX CEO John J Ray III testified before the House Financial Services Committee on Tuesday. During the interview, the FTX CEO said the cryptocurrency exchange was using QuickBooks to track its multibillion-dollar portfolio.

He told the panel that FTX had no record-keeping whatsoever. He added that;

“This is really just old-fashioned embezzlement. This is just taking money from customers and using it for your own purpose. Not sophisticated at all,” Ray said in blistering testimony that lasted more than four hours. “Sophisticated, perhaps in the way they are hiding something, frankly, right in front of their eyes. This is just plain old embezzlement. Old school, old school.”

John J Ray III took over the company after FTX filed for Chapter 11 bankruptcy last month. In an interview last month, the CEO revealed that the crypto exchange’s collapse indicates a complete lack of corporate control.

SBF denied bail in The Bahamas

The former FTX CEO Sam Bankman-Fried was arrested by authorities in The Bahamas earlier this week. SBF was recently denied bail by a Bahamian judge as he is deemed a flight risk.

The U.S. Attorney’s Office for the Southern District of New York has already charged SBF with eight criminal counts. The charges are; conspiracy to commit wire fraud and securities fraud, individual charges of securities fraud and wire fraud, money laundering and conspiracy to avoid campaign finance regulations.

The United States Securities and Exchange Commission (SEC) also charged Sam Bankman-Fried on Tuesday morning with allegedly orchestrating a scheme to defraud equity investors in FTX Trading.

Earlier this month, SBF claimed that FTX US, the United States arm of the crypto exchange, was fully solvent and withdrawals could resume soon. John J Ray III told the committee that SBF lied when he tweeted that the company had enough liquidity to cover all client holdings.