John J. Ray III, the new CEO of FTX who took over the reins after Sam Bankman-Fried resigned, criticized oversight of the bankrupt cryptocurrency exchange, speaking in court on Thursday.
“Never in my career have I ever seen such a complete failure of corporate controls and absence of reliable financial information as what I am facing,” Ray said.
“From the blow to the integrity of systems and misguided regulatory oversight abroad to the concentration of control in the hands of a very small group of inexperienced, unskilled and possibly malicious individuals, this situation is unprecedented,” he stressed.
Within days, FTX went from a $32 billion valuation to bankruptcy as liquidity ran out, customers demanded their funds and rival Binance scrapped its non-binding acquisition agreement.
The exchange that filed for bankruptcy is facing billions in lawsuits from its customers and suffered a hack through which millions of dollars went up in smoke.
Bankman-Fried was replaced by John J. Ray as the restructuring expert who oversaw the bankruptcy proceedings for Enron and Nortel Networks.
Ray had said Friday that FTX Group “has valuable assets that can only be managed effectively through an organized, joint process.”