When Mr. Ray took Mr. Bankman-Fried’s time slot in Congress, a dark agenda emerged right away. SBF was vilified immediately, before Mr. Ray could possibly have gained an understanding of the FTX business. Particularly since he had apparently removed all the technical staff.
I am not trying to excuse any financial misconduct that FTX may have committed. My comments are about the vitriol that was fed to the press from the very start, before facts could possibly have been clear. These actions surely impacted the outcome.
Before providing a simple example, this harmful, truth-distorting haste is in evidence by the fact that in time, harm to customers turned from $8B, to return of assets with interest. The prosecution, in which I include Mr. Ray, was off not just by billions, but by the sign in front of the number. The difference between a lack of liquidity, and a lack of funds must have been clear to the bankruptcy team. And yet, a decision was made to publicly announce speculations that were sure to poison public opinion, and all press coverage up to the trial.
Within days, the bankruptcy team announced to the press that FTX used the simple Intuit QuickBooks accounting software. This damning ‘revelation’ made it straight to the press. In reality, FTX used a Postgress database, which has been around for decades, and is widely used. Mr. Ray’s example, similar to “I cannot tell who were the 10 largest customers” was clearly premature. Learning how to query data in a database can be learned online by anyone with good will. Yes, databases may be a tool with which the bankruptcy team was unfamiliar. That would be understandable. What is vicious is to poison public opinion, and every possible jury pool with false, or misleading information. For that it takes ill will by both source, and the press.
An additional point of suspicion in my mind is the timing of announcing the turnaround in customer fortunes. The fact would have been clear before Mr. Bankman-Fried’s sentencing. The new reality may well have contributed to a different severity. But the news was held back by around three months. At which point Mr. Ray triumphantly announced to the press ‘his’ accomplishment of liquidating what was always there. It is difficult for me to believe that three months after the sentencing the numbers suddenly turned from negative $8B to the positive outcome for customers. The timing suggests to me a deep seated ill intention towards the company founder, and maybe towards the crypto currency industry. I do not know where the prejudice lies.
Finally, I looked up examples for offenses that carry a 25-year sentence. Examples from Connecticut [https://www.cga.ct.gov/2008/rpt/2008-r-0619.htm] are Aggravated sexual assault of a minor, Assault of a pregnant woman resulting in termination of pregnancy, and Kidnapping with a firearm.
Yes, there are differences between State and Federal law that play into these mismatches. When contemplating justice, those artefacts are irrelevant. The fact is that justice was not served here.
