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Sam Bankman-Fried is a world-class manipulator and the implosion of FTX is an ‘old-school fraud,’ Congressman says


Samuel Bankman-Fried, founder and CEO of FTX, testifies during a Senate Committee on Agriculture, Nutrition and Forestry hearing about "Examining Digital Assets: Risks, Regulation, and Innovation," on Capitol Hill in Washington, DC, on February 9, 2022Sam Bankman-Fried, founder and CEO of FTX, testifies during a Senate Committee hearing about “Examining Digital Assets: Risks, Regulation, and Innovation,” on Capitol Hill in Washington, DC, on February 9, 2022

Photo by SAUL LOEB/AFP via Getty Images

  • Sam Bankman-Fried is a world-class manipulator and the implosion of FTX was “old-school fraud,” Patrick McHenry said.
  • “Fraudsters are going to defraud investors if they get any chance to do that,” the Congressman said. 
  • The former FTX CEO was set to testify before Congress before his arrest late Monday. 

Sam Bankman-Fried is a world-class manipulator, and the implosion of FTX is an example of “old-school fraud,” Congressman Patrick McHenry said on Tuesday.

“Fraudsters are going to defraud investors if they get any chance to do that,” the North Carolina Representative said in an interview with CNBC. “So this is an old-school fraud with a new piece of technology.”

The comments follow Bankman-Fried’s arrest shortly before he was scheduled to testify to Congress about the collapse of FTX. Bankman-Fried said he would testify remotely, but was arrested Monday evening on multiple charges including fraud, money laundering, and conspiracy. 

Over the prior month, the disgraced crypto executive had been on a public apology tour, speaking to news outlets on the implosion of FTX’s finances. Though Bankman-Fried has denied accusations of fraud, he notoriously told a Vox reporter “Fuck regulators,” in an interview last month, which experts say could later incriminate him in court.

“It shows he was a manipulator of world-class capacity, and he was trying to pull off something that was light-touch regulation for his platform,” McHenry said.

The Congressman emphasized the need for “durable” crypto regulation to protect investors and innovators in the industry, possibly referring to the fact that FTX International was an offshore exchange, meaning it was exempt from US protections. He was also critical of current SEC chairman Gary Gensler, who has taken a hands-off approach to crypto regulation. 

“Congress has to step in. What we’ve seen under the Gensler regime is, he said, ‘come in and talk to me,” McHenry said. “They referred to FTX as an unregulated crypto exchange. Well, there is no means to be an unregulated crypto exchange in the United states.”

Read the original article on Business Insider