Key Takeaways:
- Kevin O’Leary has accused Binance CEO of causing FTX's demise.
- FTX's new CEO says Sam Bankman-Fried embezzled customer funds.
LAGOS (CoinChapter.com) — The unending debacle surrounding FTX collapse continues to unravel as Canadian businessman, entrepreneur and a judge on popular TV program Shark Tank Kevin O’Leary has alleged that Binance CEO Changpeng Zhao intentionally put FTX out of business.
In detail, Kevin O’Leary who is one of the witnesses at the Senate Banking Committee hearing on FTX blamed Binance CEO for part of FTX’s demise. Recall that the Senate Banking Committee on Wednesday held the second day of hearings this week examining how FTX implosion could impact the nascent industry.
O’Leary at the briefing said he contacted Sam Bankman-Fried after the company filed for bankruptcy. According to him, Bankman-Fried alleged that most of FTX’s missing funds were spent on repurchasing the company shares from Binance’s founder.
The businessman explained that around $2 billion to $3 billion from the company reserve were spent on purchasing the FTX shares. As a result, the now collapsed company balance sheet was drained of assets.
Furthermore, O’Leary disclosed that Bankman-Fried needed to purchase the shares for the survival of the company. However, CZ reportedly blocked compliance requirements in various jurisdictions where FTX was attempting to gain regulatory approval.
O’Leary also alleged that CZ refused to comply with the data demanded by various jurisdictions thwarting the process of saving the company. He said, “Binance is a massive unregulated monopoly now. This is my personal opinion.”
Sam Bankman-Fried Embezzled Customer Funds —FTX CEO
Meanwhile at the same Senate Banking Committee on Wednesday FTX’s new CEO John J. Ray debunked Kevin O’Leary’s claims. Notably, in his testimony, Ray accused FTX’s former executives including Bankman-Fried of embezzling customer funds.
Ray who underwent four hours of blistering testimony before the House Financial Services Committee on Dec. 14 declared that the embattled developer was responsible for the exchange collapse. He said, “This is really just old-fashioned embezzlement. This is just taking money from customers and using it for your own purpose. Not sophisticated at all.”
US prosecutors, securities and commodities regulators say Bankman-Fried used billions of customer funds for his own personal use. They noted that he mainly spent the money by donating to politicians and PACs, and repaying billions in loans owed by Alameda Research.
“That’s the major breakdown, here. Funds from FTX.com, which was the exchange for non-US citizens. Those funds were used at Alameda to make investments and other disbursements.”
Ray told House Financial Services Chairwoman Maxine Waters, D-Calif.
CZ Calls Out Kevin O’Leary For ‘Aligning With A Fraudster’
Meanwhile, Kevin O’Leary’s controversial statement comes at the heel of a recent clash with Binance CEO. It is worth noting that CZ and O’Leary recently fell apart after the Canadian businessman claimed that Binance’s “opaque” leadership caused FTX problems globally.
Notably, after making some unsavory claims about CZ and Binance on CNBC’s Squawk Box on Dec. 8, CZ in a 12-tweet thread slammed the venture capitalist for “aligning with a fraudster.” CZ in the thread called out O’Leary for his “baseless” attacks on his crypto platform.
Binance CEO also slammed O’Leary for accepting $15 million to become the now-defunct crypto exchange spokesperson. The Binance CEO further pointed out that his ethnicity is one of the reasons for O’Leary’s ire. Interestingly, both are Canadians, however, O’Leary has previously accused Binance of being a Chinese company.
“If @kevinolearytv is looking for someone to blame for the implosion of FTX, he should start by wagging his finger at his investment partner, Sam, and then perhaps at the man in the mirror.”
Changpeng Zhao said.
