Federal law enforcement has been in contact with former FTX employees as part of a criminal investigation into the failed exchange and its sister hedge fund, Alameda Research.
As part of a larger investigation, federal authorities have reached out to two ex-employees of FTX, aiming to gain more information about the now-defunct exchange and hedge fund.
Rather than the court-mandated process of obtaining records or other information, the authorities are simply asking for information and the employees are uncertain about what is being requested.
A federal investigation into the companies, involving the Justice Department, the Securities and Exchange Commission, the Commodity Futures Trading Commission, and state regulators, is being supplemented by an outreach initiative.
FTX’s bankruptcy lawyers declared in court that their new CEO, John Ray III, is collaborating with both regulators and law enforcement.
Ray lamented a lack of substantial record-keeping at the company in bankruptcy court proceedings, a common red flag for prosecutors, who reportedly had an ongoing investigation into the company well before its public collapse.
Bankman-Fried has been asked to speak at a hearing on FTX’s demise next week by the House Financial Services Committee.
He has so far said no, but he might show up once he has “finished learning and reviewing what happened” at his own companies.
The committee is considering issuing a subpoena to force his attendance, but this is still unlikely given the difficulties in carrying it out.
