Ex-US Regulators Connects SBF and FTX to Bernie Madoff and His Scheme
Ex-US Regulators Connects SBF and FTX to Bernie Madoff and His Scheme.
Sheila Bair, former Chair of the Federal Deposit Insurance Corporation (FDIC), compares the fall of crypto exchange FTX and its former CEO Sam Bankman-Fried to Bernie Madoff’s infamous Ponzi scheme.
The Similarities Between FTX, SBF and Bernie Madoff
In an interview with CNN Monday, Sheila Bair, one of the key regulators during the 2008 financial crisis, said that the rise and fall of FTX and former CEO Sam Bankman-Fried are almost identical to those of Bernie Madoff.
In a statement, she said that both Bankman-Fried and Madoff were adept at luring sophisticated investors and regulators by hiding their warning signs in plain sight.
“Charming regulators and investors can distract [them] from digging in and seeing what’s really going on,” she said.
“It felt very Bernie Madoff-like in that way,” she added.
Read More: President Biden Calls For Better Crypto Regulations Following FTX Collapse
It was the largest Ponzi scheme in history, worth about $64.8 billion. He promised investors high returns, but rather than investing, he deposited their funding into a bank account and paid out from existing investor funds and new investor funds, upon request.
Bankman-Fried, meanwhile, secretly transferred about $10 billion from FTX to Alameda Research and avoided accounting red flags using an accounting “backdoor.”
“You get this herd mentality where if all your peers and marquee names in venture capital are investing, you’ve got to, too. And that adds credibility with Washington policymakers. It all feeds on itself,” she said.
Robert Kiyosaki On SBF
Along with Sheila Bair, who compared it to Bernie Madoff, the author of Rich Dad Poor Dad shares the same opinion.
“WTF:FTX largest donator to Democrats for Midterms. Kevin O’Leary & Jim Kramer raved about Sam Bankman-Fried calling him the Warren Buffet of Crypto. SBF more like Bernie Madoff of Crypto. How much more corrupt can Silicon Valley & Hollywierd become? Now paying to steal elections?,” he tweeted.
WTF:FTX largest donator to Democrats for Midterms. Kevin O’Leary & Jim Kramer raved about Sam Bankman-Fried calling him the Warren Buffet of Crypto. SBF more like Bernie Madoff of Crypto. How much more corrupt can Silicon Valley & Hollywierd become? Now paying to steal elections?
— therealkiyosaki (@theRealKiyosaki) November 15, 2022
Read More: Ethereum Tanks After FTX Hacker Dumps Millions of ETH
A federal jury convicted Madoff of fraud, money laundering, and other crimes, and he was sentenced to 150 years in prison. He passed away at age 82 in prison last April.
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