Banks raised questions in 2020 about FTX-affiliated hedge fund's wire exercise, FTX says

By Hannah Lang

(Reuters) – Sure banks working with FTX founder Sam Bankman-Fried’s buying and selling agency Alameda Analysis raised questions in regards to the agency’s wire exercise as early as 2020, in response to a report launched by FTX on Monday.

Some banks started rejecting wires to or from Alameda the identical 12 months that the cryptocurrency alternate scrambled to entry the U.S. banking system, the report stated.

Federal prosecutors have alleged that Bankman-Fried stole billions of {dollars} in buyer funds to plug losses at Alameda. FTX, which filed for chapter in November after Bankman-Fried resigned as CEO, has estimated that roughly $8.7 billion in buyer property have been misappropriated from the alternate.

Bankman-Fried has pleaded not responsible to 13 counts of fraud and conspiracy. He has beforehand stated that when FTX didn’t have a checking account, some prospects wired cash to Alameda and have been credited on FTX. Bankman-Fried didn’t instantly reply to a request for touch upon the report.

In 2020, sure banks working with Alameda pressed the agency on its wire transfers, in response to the report.

One financial institution consultant wrote to Alameda about references to FTX within the firm’s wire exercise and requested whether or not the account was getting used to settle trades on FTX. An Alameda worker responded that whereas prospects “sometimes confuse FTX and Alameda,” all wires by means of the account have been to settle trades with Alameda, in response to the report.

The Alameda worker’s response was false, FTX stated on Monday. In 2020 alone, one in all Alameda’s accounts acquired greater than $250 billion in deposits from FTX prospects and greater than $4 billion from different Alameda accounts that have been funded partly by buyer deposits, the report stated.

Bankman-Fried, a 31-year-old former billionaire, rode a growth in digital property to build up an estimated internet price of $26 billion, and have become an influential political and philanthropic donor earlier than FTX declared chapter.