John J. Ray, the new chief executive office of FTX is no stranger to corporate debacles, having overseen the Enron bankruptcies and other large business collapses. But fittingly for an era that saw the biggest bubble in history (one that, at least in the stock market, is fighting tooth-and-nail to remain inflated - to no avail in my view), Mr. Ray says he’s never seen any company as badly managed as FTX in his forty years cleaning up corporate messes. FTX suffered a “complete failure of corporate controls” over billions of dollars of cash and cryptocurrencies under the management of Sam Bankman-Fraud, whose Stanford law professor parents should go back and revisit the famous commercial asking, “It’s 10 pm, do you know where your children are?” We now know that their little Sammy was running around not only at 10 pm but 24/7 ripping people off, from retail investors to some of the largest institutions in the world, while tempting lawmakers to look the other way with large political donations.
If Sammy were my kid, he’d already be in custody (or worse), but then again I only have two law degrees from NYU. In New York, we know where our children are at all times. In California, apparently, not so much.
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