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Sam Bankman-Fried’s story keeps getting wilder and weirder as details emerge from his past and more people speak out.

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Anddddd it’s Friday! Phil Rosen here, writing to you just before boarding my flight from New York to Los Angeles. 

I’ve been keeping close tabs on FTX and its disgraced founder, Sam Bankman-Fried. 

The more details that emerge, the more I feel like this is going to make a great Michael Lewis book (and movie) one day.

Today, I’m breaking down the latest on the tee-shirt-and-shorts wearing video-gamer and former billionaire. 

And tomorrow: Keep an eye out for another special weekend Q & A edition of Opening Bell, featuring one of the foremost energy experts in the business. 


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sam bankman-friedWASHINGTON, DC – DECEMBER 08: CEO of FTX Sam Bankman-Fried testifies during a hearing before the House Financial Services Committee at Rayburn House Office Building on Capitol Hill December 8, 2021 in Washington, DC. The committee held a hearing on “Digital Assets and the Future of Finance: Understanding the Challenges and Benefits of Financial Innovation in the United States.”

Alex Wong/Getty Images

1. Bankman-Fried was meant to testify before Congress this week, but for obvious reasons (he was arrested, in case you missed that somehow), the show had to go on without him. 

A deep roster of crypto voices sounded off in this week’s testimony in Washington DC, as the Senate Banking Committee asked to hear more about the debacle. 

We heard from Kevin O’Leary again, who said the market simply needs more (any?) regulation in order to thrive and move on from this fiasco. O’Leary has avoided laying any blame at SBF’s feet, and also testified he believes rival exchange Binance intentionally put FTX out of business. 

It’d be impressive if you guessed who showed up next — none other than early 2000s heartthrob-turned-crypto critic, Ben McKenzie. The star of “The O.C.” has been among the loudest skeptics, and he had a lot to say about the industry, none of it good. 

Among the highlights from his testimony include his assertion that the crypto market is “the largest Ponzi scheme in history.” 

Meanwhile, Congressman Ritchie Torres called Bankman-Fried a “pathological liar” during an interview with CoinDesk. He likened FTX to a college fraternity, with haphazard, reckless bookkeeping. 

That aligns with the characterization by new FTX CEO, John Ray III: “I’ve just never seen an utter lack of record keeping.” 

Recall that Ray had been brought in to clean up bankrupt energy firm Enron in the early 2000s. He knows a thing or two about accounting scandals. 

In his testimony to the House Financial Services Committee on Tuesday, Ray said it could take months to secure all the company’s assets, and that his team has secured over $1 billion so far.

According to Ray, under Bankman-Fried’s leadership the global conglomerate used QuickBooks to do its accounting. 

However, one of the most intriguing anecdotes from this week, as Insider’s Morgan Chittum writes, was something from Bankman-Fried’s past, long before the fraud allegations. 

Long before Bankman-Fried was in the crosshairs of regulators, he attended Crystal Springs Uplands, a top Silicon Valley prep school, and his senior class prank reportedly included making $100 bills with his face on them

The kicker? The bills were called “Bankmans,” Puck reported earlier this week.

His old school had a $56,620 annual tuition, its website shows, and there Bankman-Fried had a reputation as one of the top math students, and also led the “Puzzle Hunt Club,” which Puck described as a “particularly nerdy group at an already nerdy high school.”

After a month of FTX and Bankman-Fried drama, what are your thoughts?  Tweet me (@philrosenn) or email me (prosen@insider.com) to let me know.


In other news:

Fed PowellFederal Reserve Chairman Jerome Powell speaks at a news conference following a Federal Open Market Committee meeting, Wednesday, Nov. 2, 2022, in Washington. (AP Photo/Patrick Semansky)

Patrick Semansky/AP Photo

2. US stock futures sink early Friday, setting up for another day of big losses as investors face the reality that Fed hikes will push up borrowing costs. Here are the latest market moves.

3. Earnings on deck: Accenture, Darden Restaurants, and more, all reporting.

4. Goldman Sachs, JPMorgan, Credit Suisse and eight other top Wall Street giants have given their predictions for stocks and the economy in 2023. Bank of America, for one, is calling for a recession next year, but maintains an upbeat outlook for the S&P 500. See all of the boldest takes and economic outlooks here.

5. The Fed’s inflation forecast was wrong, according to RBC. The bank’s chief economist said Jerome Powell’s economic projection for 2023 was hard to justify. And since some Fed officials already see a recession in the cards, Powell shouldn’t try to water down risks of a downturn.

6. Elon Musk’s Tesla stock sales are throwing gas on a burning fire. That’s what Wedbush’s Dan Ives said, and he thinks shares of the EV-maker are oversold. In his view, the billionaire is using “Tesla as his own ATM machine to keep funding the red ink at Twitter.” At the same time, Tesla’s third largest individual shareholder called for a new CEO

7. A top FTX exec blew the whistle on Sam Bankman-Fried’s moves just two days before the crypto exchange collapsed. A filing showed that FTX Bahamas’ co-CEO, Ryan Salame, told local authorities that customer funds were being used to cover losses at Alameda. Get the full details here.

8. The “ultimate buy-and-hold” investment fund is beating 96% of its competitors this year with the same stocks it’s held since 1935. The Voya Corporate Leaders Trust Fund is outperforming peers with a risk-averse, Great Depression-driven strategy. Here’s how it’s still pulling in returns.

9. This retired football player turned-trader said it took him four years to nail down a profitable process. Ellis Hobbs started trading stocks from his phone in 2016, and believes that trading guidelines aren’t meant to make you earn money, but to prevent you from huge losses. Here are his four top strategies.

SP 500 index

Markets Insider

10. Morgan Stanley’s Mike Wilson said the stock market could fall further in 2023. Investors have yet to fully price in a growth slowdown with inflation set to throttle corporate profits, in the bank’s view. Wilson warned that the S&P 500 could drop to 3,000 in the first half of the year.


Curated by Phil Rosen in New York. Feedback or tips? Tweet @philrosenn or email prosen@insider.com

Edited by Max Adams (@maxradams) in New York and Hallam Bullock (@hallam_bullock) in London.

Read the original article on Business Insider
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