FTX Letter from Elizabeth Warren to the US Department of Justice!

Two US Democratic Senators wrote a letter to the Justice Department on Wednesday urging Attorney General Merrick Garland to investigate “the troubling allegations of fraud and illegal conduct that led to the collapse of FTX.”

Elizabeth Warren and Other Senators Request FTX to be “Fully Investigated” by the US Department of Justice

In the letter, Senators Elizabeth Warren and Sheldon Whitehouse reminded Garland and Deputy Attorney General Kenneth Polite that the Department of Justice recently renewed its commitment to prosecute white-collar criminals, citing the conduct of former FTX CEO Sam Bankman-Fried and other executives with “the highest level of diligence.” He asked them to honor this commitment while investigating.

Cryptocurrency Warren, who has been a longtime critic of the industry, closely followed the collapse of Bahamas-based FTX and the ripple effects of this collapse on the entire industry.

On Tuesday, Warren, Durbin and Senator Tina Smith sent a letter to Fidelity asking this financial services firm to reconsider allowing retail clients to include Bitcoin in their retirement plans.

And last week, Warren and Senator Dick Durbin sent a letter to Bankman-Fried and FTX’s current CEO, John Jay Ray III, asking for information on what caused the stock market crash.

Warren and Whitehouse’s letter added that, in addition to the knock-on effect in the broad crypto industry, FTX gives retail investors a “false sense of security and legitimacy” with “highly paid advertising posts and celebrity endorsements.”

Bankman-Fried bears the bulk of Warren and Whitehouse’s anger, though the letter urges the Department of Justice to investigate and prosecute any FTX executives who may have been involved in the alleged fraud.

The senators used the following statements in the letter:

“The collapse of FTX appears to have been the result not just of sloppy business and management practices, but rather the deliberate and fraudulent tactics employed by Mr. Bankman-Fried and other FTX executives to enrich themselves.

In fact, Mr. Bankman-Fried had already demonstrated his true enrichment interests when he siphoned $300 million into his own wallet last year.”

*Not investment advice.

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