FTX Managers Use Emojis To Approve Official Expenses. New CEO Says

• According to its CEO, FTX employees were able to claim expenses via chat messages.
• John Ray said that random managers would then approve official claims using personalized emoticons.
• Ray’s damning report stated that FTX failed communication, to hire, and to maintain financial records.

The CEO of the crypto exchange FTX said that employees would use chat to file expense claims and that random managers would then approve them by responding with emojis.

John Ray, the new CEO of FTX, stated that employees from the company submitted payment requests to a “disparate Group of Supervisors” who would approve expenses by responding with “personalized emojis.” Thursday’s bankruptcy filing by FTX.

Ray stated that the Debtors didn’t have the disbursement controls I consider appropriate for a business venture. 

Ray, a lawyer who oversaw Enron’s bankruptcy, was appointed to oversee FTX’s restructuring. On August 31, the exchange filed for bankruptcy. November 11.

Ray stated that he has never seen a failure in corporate controls or a lack of trustworthy financial information like this.

He blasted FTX executives. Sam Bankman-Fried was the former CEOThey claimed they didn’t keep accurate records of their communications, and made other mismanagement claims.

Ray stated in the filing that “One of the most widespread failures of FTX.com is the absence of durable records of decision-making.” “Mr Bankman Fried often communicated using applications that were set up to automatically delete after a brief period.” 

He said that Bankman-Fried would encourage employees use the same chat software.

Ray stated that FTX had never held board meetings and that employees used their personal names to buy real estate in the Bahamas using corporate funds.

He stated that FTX had not kept proper records regarding who it hired. “Repeated attempts have been made to locate certain presumed workers to confirm their status have failed to date,” he stated, suggesting that some of these workers may not even exist.

Ray lashed out at Bankman Fried in particular, stating that Bankman Fried “continues make erratic public statements.” He emphasized the importance of a Vox reportAn alleged Bankman-Fried sent a DM saying so to Kelsey Piper “Fuck regulators” and “they make it worse.”

Bankman-FriedHe resigned on November 11, the day that FTX filed bankruptcy. Alameda Research, his trading company, and about 130 of its affiliate companies, have filed for bankruptcy.

Binance, a rival crypto exchange, had been set to acquire FTX prior to the collapse of FTX. However, it pulled out citing the findings of the due diligence. Federal probes of FTX raise concerns

Insider asked Bankman-Fried for comment, but were not immediately able to respond.