Lawyers representing collapsed crypto exchange FTX said the firm was “effectively run as a personal fiefdom” for founder Sam Bankman-Fried today, as court documents showed the firm had splurged nearly $121m in property in the past two years.
FTX’s lawyers, who were called in to represent the firm after the ousting of the 30-year old founder, criticised the corporate controls at the firm and described the case as a “different sort of animal”.
“Unfortunately, the FTX debtors were not particularly well run, and that is an understatement,” said FTX counsel James Bromley, in comments reported by CNBC.
Lawyers for the firm said that the firm had been run as a “personal fiefdom” for former-billionaire Bankman Fried and their central role was now “working to bring order to disorder.”
The comments from lawyers came as property record showed that Bankman-Fried, FTX, his parents and senior executives of the firm bought at least 19 properties worth nearly $121m in the Bahamas over the past two years, according to official property records show.
In documents seen by Reuters, the firm was found to have splurged nearly $72m on seven apartments in an expensive resort community called Albany, alongside a host of luxury beachfront homes.
An insolvency team led by industry veteran John Ray III, who oversaw the bankruptcy of Enron, has been looking to map out the firm’s assets and track down cash to pay back customers.
Court filings on Monday revealed the firm had around $1.24bn in cash balances, which consultants said were “substantially higher” than first believed.