Now-bankrupt cryptocurrency platform FTX spent millions of dollars on food, swanky accommodation, and flights around the world nine months before it went into administration, documents reveal.
According to court filings cited by the Business Insider report, FTX Digital Markets stumped up over $40 million USD. This took place from January to September last year, just months ahead of its collapse on 11 November.
Room and Board (of Executives)
Despite the company citing alleged “liquidity issues” for its bankruptcy, it spent over $15 million for luxury accommodation. The Albany Hotel, where disgraced chief executive Sam Bankman-Fried resided prior to his arrest, cost roughly $5.8 million of the firm’s hotel expenses.
Business Insider explained:
“In 2021, one of the Albany’s founders told Fortune that in high season, accommodation at the resort can cost as much as $60,000 per night. $3.6 million of FTX’s hotel spend went to the Grand Hyatt, a 4-star hotel where the cheapest room costs $369 a night. In March 2022, the hotel hosted the Caribbean reception for Prince William and Kate, Princess of Wales. FTX spent $28,954 at the hotel the same month”
FTX splashed out a further $3.6 million to the four-star Grand Hyatt, where Britain’s Royal Family stayed in March last year. Executives and others from the company racked up $800,000 in expenses at the five-star Rosewood Resort.
Living La Vida Loca
Also, the firm spent nearly $7 million on food and leisure, where half of the bill paid for catering. FTX staff also spent around $4 million on travel costs and $500,000 on deliveries and donated regularly to charities and organisations in the country.
The Bahamian company also provided local staff with a “full suite of cars and gas covered for all employees [and] unlimited, full expense covered trips to any office globally,” the report said.
Additional expenses included private flights for Amazon orders to Miami as the firm does not deliver to the island country. According to a former staff member, FTX’s lavish expenditures were “cult-like” and the business was “iconically and moronically inefficient.”
Room Without a View
Bahamian authorities arrested Sam Bankman-Fried from his luxury accommodation in mid-December last year. He has plead not guilty in early January to eight charges, which include fraud, defrauding investors, and others. He awaits further hearings from at the US District Court in the Southern District of New York.
Caroline Ellison, the former chief executive for Alameda Research, agreed to a plea deal with courts to eliminate seven of eight counts of fraud, funds mismanagement, and other offences.
