No time managing risk? No wonder FTX collapsed
By 
Kyle Brasseur2022-12-06T13:00:00
The more Sam Bankman-Fried talks, the easier it is to comprehend how his crypto exchange once valued at $32 billion could fall apart in a span of 10 days.
The founder and former chief executive officer of FTX has been characteristically outspoken over the past week about what went wrong to lead his company to the Nov. 11 bankruptcy filing that rocked the cryptocurrency world. In a parade of media and speaking appearances—apparently in defiance of his legal representatives—Bankman-Fried has been contrite in accepting the blame for his failings and the damage he’s done.
The sincerity of such an approach will always be questioned, but in taking his words at face value, the biggest surprise might be Bankman-Fried’s exchange even managed to last the three years it did. His discussion of FTX’s approach to risk management during a lengthy interview for “Good Morning America” is enough to make any compliance officer cringe.
THIS IS MEMBERS-ONLY CONTENT
You are not logged in and do not have access to members-only content.
If you are already a registered user or a member, SIGN IN now.
Related articles
-
News BriefFed raps FTX-linked bank for unapproved switch to digital banking
The Federal Reserve Board placed restrictions on Washington-based Farmington State Bank after taking issue with how the liquidating financial institution changed its business plan without seeking proper approvals.
-
News BriefCFTC commissioner urges crypto gatekeepers ‘step up and call for compliance’
Christy Goldsmith Romero of the Commodity Futures Trading Commission called out gatekeepers—lawyers, accountants, auditors, compliance professionals, and others—for failing customers in the unregulated cryptocurrency market.
-
ArticleBankman-Fried fraud charges detail FTX’s lack of internal controls, risk management protocols
A flurry of criminal and civil fraud charges laid against FTX founder Sam Bankman-Fried have pulled back the veil on the cryptocurrency exchange’s complete lack of internal controls and toothless risk management procedures.
More from Opinion
-
OpinionWhy are CFOs struggling to stay compliant?
CFOs are tasked with overseeing an organization’s entire financial processes, not least ensuring that financial operations remain compliant with the multitude of global regulations. It’s a heavy burden to carry that might be alleviated slightly with the help of artificial intelligence, writes Markus Hornburg, head of compliance at Basware.
-
OpinionFive reasons why I’m excited about CW’s Cyber Risk & Data Privacy Summit
Having worked for Compliance Week for three years, I’ve found it remarkable how compliance professionals can be so consistently upbeat about their plight. An often refrain in compliance circles is “be comfortable with being uncomfortable.” As difficult as the job can be, that clearly doesn’t mean it can’t be fun.
-
OpinionEricsson's 'integrity journey' post-FCPA settlement top compliance triumph of 2024
It’s been a long “integrity journey” for Ericsson, according to the company’s Head of Compliance Global Affairs Alison Howell. Since settling with the DOJ over FCPA violations in 2019, the company has gone through a "business critical transformation," resulting in the end of its compliance monitorship.