‘No separateness whatsoever’ between FTX and Alameda Research, FTX CEO says
FTX CEO John Ray, who is overseeing the company’s bankruptcy proceedings, told House members on Tuesday that no separation existed between the operations of FTX and Alameda Research, a crypto hedge fund also founded by Bankman-Fried.
“There were virtually no internal controls and no separateness whatsoever,” Ray said.
Bankman-Fried faces accusations that FTX used deposits to pay Alameda Research creditors, a claim reportedly made by former Alameda Research CEO Caroline Ellison during a call in early November.
In an interview last week, Bankman-Fried told ABC News’ George Stephanopoulos that he was not aware that was true but said Alameda had a large position open on FTX that was "overcollateralized a year ago."
![PHOTO: FTX Group CEO John J. Ray III waits to begin his testimony before a House Financial Services Committee hearing investigating the collapse of FTX after the arrest of founder Sam Bankman-Fried, on Capitol Hill in Washington, Dec. 13, 2022.](https://i.abcnewsfe.com/a/973a9eb8-76b9-41e5-b376-2d07ddc079a8/john-ray-house_hpEmbed_20221213-115944_3x2.jpg)
Ray told House members that FTX transferred several billion dollars in customer funds to Alameda Research.
When asked by Rep. Patrick McHenry, R-N.C., if there was a distinction between FTX and Alameda Research, Ray said, “Absolutely not. There’s no distinction whatsoever.”
“The owners of the company could run free reign,” Ray added, noting that Bankman-Fried owned 90% of Alameda Research.