Finance & EconomicsConfirmed
FTX customer-fund commingling and Alameda backdoor (2019-22)
FTX, the cryptocurrency exchange founded by Sam Bankman-Fried (SBF), secretly transferred billions in customer deposits to its affiliated trading firm Alameda Research, which used the funds for investments, loans to executives, and political donations. When Alameda's balance sheet leaked in November 2022, a bank run ensued and FTX collapsed. SBF was convicted on seven counts of fraud and conspiracy in November 2023 and sentenced to 25 years. Testimony from co-conspirators Caroline Ellison and Gary Wang confirmed the Alameda auto-liquidation exemption and the deliberate nature of the commingling.