The Secret Story of FTX’s Rise and Ruin Part 1

Summary

Reveal Podcast: The Secret Story of FTX's Rise and Ruin (Part 1)

Episode Date: September 27, 2025
Host: Al Letson
Reporter: Jonathan Jones
Produced by: The Center for Investigative Reporting & PRX

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Overview

This gripping episode of Reveal dives deep into the meteoric rise and catastrophic collapse of FTX, once a global cryptocurrency powerhouse led by Sam Bankman-Fried. The story unfolds with exclusive interviews—from FTX customers to employees, from courtrooms to the parents of Sam Bankman-Fried themselves—highlighting personal, legal, and ethical dimensions of the scandal. The episode scrutinizes not just FTX’s internal implosion, but also the controversial bankruptcy proceedings, raising the question: did the aftermath protect customers, or simply enrich the power brokers?

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Key Discussion Points & Insights

1. The Untold Story Spark

• Jonathan Jones’s Entry: Jones was prompted by a family member connected to Sam Bankman-Fried’s parents, Barbara Fried and Joe Bankman, both prominent Stanford law professors.
  • "Honestly, I knew very little about Sam Bankman-Fried. I don't know, I'm not even sure I could have picked him out of a lineup at that time." (03:37, Narrator/Reporter)
• A Broader Narrative: As Jonathan investigated, the story expanded beyond Sam himself to encompass customers, staff, lawyers, and regulators.

2. The Parents’ Perspective: Barbara Fried & Joe Bankman

• Law Firm Allegations: Joe and Barbara insist the collapse narrative overlooks the role of the powerhouse law firm, Sullivan & Cromwell, whom they claim orchestrated Sam’s ouster and benefited massively from the bankruptcy (claims the firm denies).
  • "Sullivan & Cromwell shouldn’t have been in that role to begin with." (05:58, Al Letson as paraphrased from the parents)
• On Public Trust: The parents acknowledge skepticism about their perspective—“They shouldn’t trust us. They should look at the facts.” (06:35, Al Letson speaking for the Bankman-Frieds)

3. Sam Bankman-Fried Speaks from Prison

• Post-Collapse Stance: Sam proclaims his innocence, asserting FTX was never bankrupt and funds weren’t missing.
  • “You know, I never defrauded anyone.” (08:08, Sam Bankman-Fried)
  • “Even if I had been aware of everything, I don't think that means I committed a crime.” (08:17, SBF)
• Prison Life Anecdote: Sam exhibits his characteristic irreverence about his prison jumpsuit.
  • “There's this extremely dumb cat-mouse game… I'm just going to keep an ear out and if I hear noise I'll sort of scramble to put the jumper back on.” (07:41, SBF)

4. The Rise of Alameda and FTX

• Alameda’s Beginnings: Sam’s initial crypto arbitrage across global markets and the whirlwind profits.
  • “Basically, we were making a million dollars a weekday. On the other hand, I had no f—ing clue how to run a company.” (09:47, SBF)
• Founding FTX: Launched offshore for regulatory reasons, FTX quickly became a global player. It marketed itself as safe and above-board—a contrast with previous crypto operations.
• Culture and Leadership: Insiders and employees describe FTX as innovative but chaotic, lacking strong internal controls.
  • “Wow, we’re moving really fast. I think we need to stop and consider maybe more strategy here and there.” (17:39, Caroline Papadopoulos, Accountant)
  • “It was really kind of ad hoc… kind of held together with the data equivalent of Scotch tape.” (18:28, Dan Czapski, Head of Data Science)

5. Customer Stories: Loss and Disillusionment

• Everyday Investors: Hotel owner Tarek Murad and artist Lydia Favario both share how FTX’s slick image and Sam’s effective altruism rhetoric drew them in—and left them devastated.
  • “His money were literally my life savings. Literally all what I had was there.” (14:39, Lydia Favario)
• Celebrity Endorsements: The episode references splashy marketing, including Steph Curry and major arena sponsorships.

6. Collapse Triggered: The Coindesk Leak & CZ’s Tweet

• The Leak: Coindesk publishes a leaked Alameda balance sheet, revealing deep liquidity problems—the start of FTX’s unraveling.
  • “This article came out, it gives us concerns, and... we’re going to be selling all the FTT that we have left.” (21:55, SBF referencing CZ/Binance)
• Run on the Bank: CZ’s tweet leads to unprecedented customer withdrawals—from $50 million on a typical day to $4 billion.
  • “40 times as much as we'd ever seen in a day before.” (24:09, SBF)

7. The Truth Emerges: Employee Confessions & Internal Chaos

• Secret Recording: In Hong Kong, Alameda CEO Caroline Ellison admits at an all-hands meeting that Alameda took outsize, unauthorized loans from FTX customer funds.
  • “Alameda was kind of borrowing a bunch of money via open-term loans… and use that to make various illiquid investments... led to FTX having a shortfall in user funds.” (26:20, Caroline Ellison)
  • The loss: “The latter [closer to $6 billion].” Ultimately, $8 billion+ would be missing. (27:17)
• Panic Among FTX US Staff: Desperate efforts to back up accounting records as the company implodes.
  • “We were just backing everything up … if we don't know who to trust, we want to make sure we have all the raw records in case anybody doctored anything.” (29:01, Caroline Papadopoulos)

8. Bankruptcy and Surrender of Control

• Legal Coup: Under pressure from Sullivan & Cromwell and his parents, Sam signs an agreement handing FTX over to “crisis fixer” John Ray.
  • “The single biggest mistake I made by far was handing the company over to Sullivan and Cromwell.” (35:08, SBF)
• Loss of Narrative: Once bankruptcy hits, the story is shaped by Ray’s scathing reports (compared to Enron) and by the new legal team.
  • “Such a complete absence of trustworthy financial information. This situation is unprecedented.” (41:17, John Ray in first bankruptcy court filing)

9. Contested Bankruptcy and Competing Narratives

• Exclusion of Insiders: Staff like Dan Czapski believe Ray and the new team refused help from those who understood FTX’s data.
  • “I was sending a lot of Slack messages and emails saying, hey, let me help you … If you don't trust me, just tell me where to go.” (43:00, Dan Czapski)
• Legal Power Struggles: Critics—including legal scholars—raise alarms that Sullivan & Cromwell both designed and benefited from FTX’s collapse, and may have coordinated early with federal prosecutors without telling Sam.

10. Sam’s Final Public Defense, Arrest, and Aftermath

• Twitter Storm & Interviews: Sam continues to defend himself in public, sometimes against legal advice.
  • “No, they are very much not [recommending he do interviews].” (45:55, SBF)
• Behind-the-Scenes with Prosecutors: After FTX’s collapse, Sullivan & Cromwell are communicating with federal officials about FTX before Sam relinquishes control—raising questions of client loyalty.
• Arrest & Legal Consequences: On the eve of Congressional hearings, Sam is arrested in the Bahamas.
  • “Just remember, the sun will shine tomorrow.” (50:22, Barbara Fried recalls a guard’s words)
• Everyone Flips: Sam’s inner circle cooperates with prosecutors; he’s convicted and sentenced to 25 years in prison.
• Bankruptcy Fallout: Former FTX users remain in limbo, and questions intensify about whether the bankruptcy serves customers or corporate lawyers.

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Notable Quotes & Memorable Moments (with Timestamps)

• On skepticism toward Sam’s parents:
  “They shouldn’t trust us. They should look at the facts.”
  —Joe Bankman (06:35)

• On FTX’s shoddy structure:
  “It was really kind of ad hoc… Scotch tape.”
  —Dan Czapski (18:28)

• On liquidity crisis after the Coindesk leak:
  “40 times as much as we'd ever seen in a day before [were withdrawn].”
  —Sam Bankman-Fried (24:09)

• Caroline Ellison’s confession to staff:
  “Alameda was kind of borrowing a bunch of money… led to FTX having a shortfall in user funds.”
  —Caroline Ellison (26:20)

• On John Ray’s first bankruptcy statement:
  “He had never seen… such a complete absence of trustworthy financial information. This situation is unprecedented.”
  —John Ray (41:17)

• Sam’s regret:
  “The single biggest mistake I made by far was handing the company over to Sullivan & Cromwell.”
  —Sam Bankman-Fried (35:08)

• On the bankruptcy process from a customer’s view:
  “I was fuming. I was furious because these people, they were playing around with our lives, with our money.”
  —Lydia Favario (51:48)

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Important Segments (Timestamps)

• Family connection to the story: [02:44]
• Parent accusations against law firm: [05:17]
• First prison interview with Sam: [07:09–08:23]
• Alameda’s founding and FTX’s growth: [09:14–12:44]
• Customer stories: [13:18–15:53]
• CZ’s tweet and run on FTX: [21:29–24:09]
• Caroline Ellison’s admission: [26:20–27:39]
• Chaos in FTX US accounting team: [28:36–29:12]
• Sam’s surrender and regret: [31:33–35:08]
• John Ray’s takeover and bankruptcy filings: [39:09–41:17]
• Contentious aftermath, legal maneuvers: [47:21–50:27]
• Sam’s arrest: [49:35-50:55]
• Episode cliffhanger and tease for part 2: [51:39]

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Tone and Style

• Investigative and richly detailed, blending explanatory journalism with personal narratives and exclusive source material.
• Empathetic to small investors and those swept up in the chaos.
• Critical of power structures and legal machinations in the bankruptcy aftermath; maintains skepticism toward all sides.

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Conclusion and Next Steps

The episode closes with customers still left in uncertainty, their savings trapped in bankruptcy proceedings that seem tilted toward law firms, not victims. With Sam convicted but appealing, part two promises to examine the ongoing consequences—particularly “who wins and who loses” as the bankruptcy process plays out.

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For more, including access to original FTX documents, listeners are directed to revealnews.org.

To be continued in Part 2…

Transcript

[Al Ledson]

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[Jonathan Jones]

Hey, this is Al. And I'm sure it is no surprise to you that President Trump doesn't like us very much. He called the press the enemy of the people. Credentialed journalists have been banned from press briefings just for asking tough questions. Trump personally sued news networks demanding billions. And now, at his urging, Congress has voted to gut all federal funding for public broadcasting. And I think I know why. I think we all do. It's because real journalism brings sunlight, scrutiny, accountability. When power feels threatened, it lashes out. And that tells you just how vital independent reporting is. Right now here at Reveal, we don't answer to billionaires or politicians or special interests. We only answer to you, our listeners. But we can't do this alone. Stand with us. Support fearless independent journalism that refuses to back down. Donate today. Just visit revealnews.orgfearshell Again, that's revealnews.orgfearshell. thanks. From the center for Investigative Reporting and PRX. This is Reveal. I'm Al Edson. Last summer, Reveal's Jonathan Jones got an unexpected phone call from a relative who said he had a scoob for him.

[Narrator/Reporter]

It'S not generally when your family calls you up with story ideas, it's you should take everything with a grain of salt. It's a little perilous.

[Jonathan Jones]

The relative just had dinner with Barbara Fried and Joe Bankman. They're Stanford law professors, widely considered experts in their fields. And they're also the parents of the former cryptocurrency CEO Sam Bankman Fried. Remember Sam Bankman Fried? He founded the cryptocurrency exchange ftx, became the face of the industry and one of the world's youngest billionaires.

[Sam Bankman Fried]

And the.

[Jonathan Jones]

And then one day, from crypto king.

[Al Ledson]

To criminal suspects arrested in the Bahamas on Monday.

[Sam Bankman Fried]

So many people wondering where their money is.

[Jonathan Jones]

It was one of the biggest financial scandals in American history. Sam was convicted of fraud and sent to prison for 25 years. But the story hadn't grabbed Jonathan's attention.

[Narrator/Reporter]

Honestly, I knew very little about Sam Bankman Fried. I don't know, I'm not even sure I could have picked him out of a lineup at that time.

[Jonathan Jones]

Still there, his relative was telling Jonathan that the Bankman Frieds believed the story about how FTX collapsed was all wrong. The relative asked if he could put them in touch. At this point, crypto was back on the rise. What had once seemed like a shady underworld had gone decidedly mainstream, with big banks getting in on the action and public figures touting gains in their crypto portfolios.

[Narrator/Reporter]

It became clear that this story was not just about Sam Bankman Fried. It was about all these other people, from customers to lawyers to government regulators. And understanding sort of how these pieces fit together was fascinating to me.

[Jonathan Jones]

That was the kind of story Jonathan couldn't say no to. And it's the story we're gonna tell you today and next week too, because Jonathan would end up talking to a bunch of people from the customers most deeply impacted by FTX's collaps, to the staffers who had a front row seat to how it all went down. He also dug into courtroom audio, thousands of pages of legal filings, and crucial emails from inside the company to understand how things unfolded. Because the story of FTX didn't end with its collapse, it was also about the controversial bankruptcy that followed and whether it served the best interests of customers. For Jonathan, it all started when he agreed to chat with Barbara Fried.

[Narrator/Reporter]

After some back and forth with Barbara over email and then, zoom, I found myself driving down to Stanford to meet with her and Joe in their home. We sat in their living room and they told me that there was this untold story about what had happened with the fall of ftx.

[Al Ledson]

I think in Sam's case, the prosecution and the law firm played a significant role in kind of diverting the media away from digging into the facts.

[Narrator/Reporter]

From the very start, Joe and Barbara said there was this law firm, Sullivan and Cromwell. They claimed the firm's lawyers helped engineer Sam's exit from FTX and then cashed in on the bankruptcy, a claim the firm says is false.

[Al Ledson]

Sullivan Cromwell shouldn't have been in that role to begin with. So John Rhee, can I. Yes, you can.

[Narrator/Reporter]

Do you want, when you ask these.

[Jonathan Jones]

Questions, do you want just like a.

[Narrator/Reporter]

Three sentence answer or the longer answer?

[Al Ledson]

Cause if it's three sentence, go with him.

[Narrator/Reporter]

We talked for hours. It was clear that all they ever thought about night and day was Sam and trying to clear their son's name. Why should anyone trust Sam Bankman Fried's parents on these questions? Like of course, no, first of all.

[Al Ledson]

They shouldn't trust us. They should look at the facts. And many of the relevant facts are public. They've been public for a long time. And so all we would say to people is, you have heard one side of the story.

[Narrator/Reporter]

Only a few days later they invited me to a call with Sam. When the time came, there he was sitting in a cinder block room with a poster of animals sitting on toilets behind him. Messy hair, rumpled gray T shirt, loose collar.

[Sam Bankman Fried]

My name is Sam Bankman Fried. I went to college at MIT, worked on Wall street trading, ETFs had a blast.

[Narrator/Reporter]

In 2017, Sam was game to talk at length about what had happened.

[Sam Bankman Fried]

And then a crisis came. A bunch of lawyers took over the companies and I ended up in federal prison. And that's where I am today.

[Narrator/Reporter]

I got a sense Sam couldn't help but push the boundaries of what he could and couldn't do, like whether he always had to wear his prison jumpsuit.

[Sam Bankman Fried]

There's this extremely dumb cat mouse game where for reasons no one has ever bothered to articulate between the hours of like 6am and 3pm on weekdays, the only clothing we're allowed to wear is the one piece prison jumpsuit. I'm just going to keep an ear out and if I hear noise I'll sort of scramble to put the jumper back on.

[Narrator/Reporter]

We talked and talked, and mainly there was one thing Sam wanted me to know.

[Sam Bankman Fried]

You know, I never defrauded anyone.

[Narrator/Reporter]

The money wasn't gone, FTX wasn't bankrupt, he was innocent.

[Sam Bankman Fried]

Even if I had been aware of everything, I don't think that means I committed a crime.

[Narrator/Reporter]

We spoke About a half dozen times before he was moved to another prison and I lost access. But by then I'd started piecing together how Sam Bankman Fried's empire came crashing down and the warning signs that had been missed along the way. Growing up, Sam was a math kid on the spectrum, didn't party. After mit, he became a trader on Wall street, using algorithms to make lightning fast bets on the stock market. Then this odd thing about crypto caught his eye. Bitcoin prices were trading way higher in some countries than others.

[Sam Bankman Fried]

My first instinct was, this is wrong. This data is just incorrect because it's crazy.

[Narrator/Reporter]

It turned out if you timed it right, you can make boatloads of money.

[Sam Bankman Fried]

You were in fact allowed to spend $100 in America to buy $100 of BIT, send it to Japan, sell it for $130 of yen, and you could make $10 million debt. That is. I mean, it's the best trade I've ever seen in my life.

[Narrator/Reporter]

Sam moved to Berkeley, California to start a new company to buy and sell crypto. He called it Alameda Research. The name sounded prestigious and purposely avoided the word crypto, which was rife with scams, fraudsters and Ponzi schemes.

[Sam Bankman Fried]

The early golden era was January of 2018. Basically, we were making a million dollars a weekday. On the other hand, I had no fucking clue how to run a company.

[Narrator/Reporter]

Colleagues described those early days as messy. Money vanished, then reappeared. Some raised concerns about ethical gray areas, misleading investors, unexplained financial gaps. Many of the early employees, including his co founder, resigned. Sam told me he was bad at accounting and managing people, but he insisted it was nothing to worry about, just the normal growing pains of a typical startup. By 2018, Sam was touting that Alameda was moving hundreds of millions of dollars in crypto every day. Yet Sam had his sights set on creating something bigger. Ftx. A crypto marketplace where customers could deposit funds, buy and sell crypto and trade with each other. What does FTX stand for?

[Sam Bankman Fried]

Oh, God. Futures Exchange. The F and the T, both from the word futures.

[Narrator/Reporter]

Futures are a common type of trading in the financial world. They're basically bets on the future price of something. Crypto traders love them because if you're right, the payouts can be huge. And FTX would make a lot of money off fees from these transactions. Getting licensed as a crypto futures exchange in the US was tricky though, so Sam went offshore. He launched FTX in Antigua, then moved it to the Bahamas. He wasn't hiding out in a tax haven, though. He was very much out there talking directly to possible FTX customers all day, every day, on any platform he could think of.

[Sam Bankman Fried]

You can follow me on Twitter, you can go to our telegram and you know, obviously check out the website FTX.com and make it your one stop shop for trading crypto.

[Narrator/Reporter]

And it worked. By 2022, Sam was running one of the biggest crypto exchanges in the world. From a luxury apartment overlooking the Caribbean, he surrounded himself with loyal insiders. Gary Wang, his MIT roommate, Nishad Singh, an old family friend, and Caroline Ellison, a former colleague. Sam dated on and off, but Sam owned nearly all of Alameda and most of ftx, giving him control over major decisions at both companies. Sam bought the naming rights to the Miami Heat Arena. He was flying around in private jets, rubbing shoulders with celebrities like Orlando Bloom and Katy Perry, and spending big on splashy ads. This is Steph Curry, the world's leading expert on cryptocurrency.

[Jonathan Jones]

No, I'm not an expert and I don't need to be with ftx.

[Narrator/Reporter]

I have everything I need to buy.

[Jonathan Jones]

Sell and trade crypto safely.

[Narrator/Reporter]

In April of that year, he threw a conference called Crypto Bahamas. The lineup was stacked. Bill Clinton, Tony Blair and the author Michael Lewis. Like three years ago, nobody knew who you were and now you're sitting on the COVID of magazines and you're a gazillionaire and your business is like one of the fastest growing businesses in the history of the planet. FTX was attracting all kinds of new investors, from hedge fund managers to celebrities to everyday traders.

[Najeeb Mamini]

Bitcoin was a very weird thing. It's almost shady.

[Narrator/Reporter]

Like Tarek Murad was a hotel owner and operator in Calgary. He'd started investing in crypto before it went mainstream. When buying a coin felt a little.

[Najeeb Mamini]

Sketchy, I remember having to go to the bank and wire just some stranger money with a picture of my ID and a letter that I authorized this transaction and he would send me a bitcoin.

[Narrator/Reporter]

FTX seemed to offer an attractive alternative. No backchannel wires, just a decent app that made crypto feel safe, above board and professional.

[Najeeb Mamini]

They were gaining traction and there was a lot of media and advertising around them. You know, it was really the one major one that was within our continent.

[Narrator/Reporter]

The platform was also drawing in smaller investors. People like Lydia Favario, a conceptual artist originally from Italy, now living in the uk. She earned most of her income working as a life model, posing for students in drawing classes.

[Al Ledson]

So I earn an average of 20 pounds per hour, so it's not really.

[Narrator/Reporter]

So much in addition to some small savings from life modeling, Lydia had a modest sum she'd received as a settlement from a car crash years ago. She put it all on ftx, planning to use it as her retirement nest egg.

[Al Ledson]

And his money were literally my life saving. Literally all what I had was there.

[Narrator/Reporter]

Lydia wouldn't describe herself as a crypto person, but when she heard about Sam Bankman Fried, she was intrigued.

[Al Ledson]

I was really fascinated about this super younger person that had these extraordinary ethos and managed to become rich so young.

[Narrator/Reporter]

With the idea to do something good for the humanity. That's another reason why everyone loved Sam. He said he wanted to make money just to give it all away. Part of a movement called effective altruism, it used data and algorithms to figure out where money could do the most good. And it was gaining traction in tech circles. The FTX foundation funded academic research, policy groups, animal welfare campaigns, and a slew of other efforts aimed at building what Sam called a better future. Some contributions were harder for Sam to explain, like the $1 million to a super PAC co founded by his mom. Sam became one of the largest donors to Democrats in 2022, while also secretly funneling dark money to Republicans.

[Sam Bankman Fried]

I ended up making a lot of campaign contributions in 2022, and not all of those were public.

[Narrator/Reporter]

At the same time, FTX was expanding. Sam was spending money all over the world, snapping up crypto exchanges from Japan to Europe, hoping to fast track licenses and legitimacy in key markets. In the U.S. fTX bought LedgerX, which was licensed to offer a full range of crypto trading options. Along the way, FTX recruited a network of auditors, compliance officers, and lawyers who knew how to speak the language of regulators and opened doors in Washington. One of them was Ryan Miller, a former partner at Sullivan and Cromwell, one of Wall Street's most powerful law firms. Sullivan and Cromwell would eventually be brought in to help with U.S. acquisitions. Miller became general counsel for FTX U.S. he says when he first arrived, the company felt like a young startup struggling to keep up with its rapid growth. On the law podcast Original Jurisdiction, Miller remembered talking with Sam about building stronger internal controls. Sam really valued being.

[Sam Bankman Fried]

He would profess to really value being.

[Narrator/Reporter]

Nimble and not overburdened by a huge corporate structure. Other employees noticed Sam's scrappy startup mentality, too, like Caroline Papadopoulos, a seasoned accountant.

[Al Ledson]

They were extremely intelligent. They all moved very fast with, hey, this is an idea. Does it make sense? Great. Go figure out how to implement it.

[Narrator/Reporter]

Did you have moments where you felt he played a little too loose with the rules?

[Al Ledson]

Probably, yeah. I mean, I think it was, wow, we're moving really fast. I think we need to stop and consider maybe more strategy here and there. But he also was so confident that it kind of diminished the concern. Like, he's got this.

[Narrator/Reporter]

Not all FTX employees shared that belief. Dan Czapski also joined FTX in 2021 as head of data science. He'd worked at other tech companies, including Facebook.

[Jonathan Jones]

So he worked for a child billionaire for many years. My impression of Sam was that he.

[Narrator/Reporter]

Was another child billionaire, a young CEO being rewarded for growing fast no matter the cost. That was nothing new to Dan, and.

[Jonathan Jones]

Yet I was a little surprised at how spartan FTX was. So they had some tooling and data and stuff, but it was really kind of ad hoc and built one off every once in a while by a couple of the engineers and not really maintained.

[Narrator/Reporter]

To Dan, FTX felt disorganized, almost like a glossy site held together with the data equivalent of Scotch tape. At its peak, FTX was operating in 250 jurisdictions around the world, overseeing tens of billions in assets and handling as many as 26 million transactions per day. But behind the scenes, something wasn't adding up. And on November 2, 2022, word got out.

[Sam Bankman Fried]

CoinDesk reached out, saying they're going to be running an article looking for confirmation.

[Narrator/Reporter]

Coindesk, an online news site covering crypto, had a scoop. They had a leaked balance sheet from Alameda Research, Sam's private trading firm. It suggested Alameda was was dangerously short on cash. Much of its assets were actually made up of FTX's own crypto token. Its in house currency, not dollars or traditional assets.

[Sam Bankman Fried]

And you know, at the time, I basically thought, oh, this is going to be a negative PR thing. But not, you know, whatever. It'll be a bad PR week.

[Narrator/Reporter]

It's about to be much worse than a bad PR week.

[Jonathan Jones]

Coming up, the CoinDesk article prompts a tweet from a powerful rival, sending customers all over the world into a panic. That's next on Reveal.

[Najeeb Mamini]

Hello, listener. My name is Najeeb Mamini and I am a producer here at Reveal. Reveal is a nonprofit news organization and we depend on support from our listeners.

[Sam Bankman Fried]

Listeners like you.

[Jonathan Jones]

Donate [e-mail] donate. It helps fund the stories that we.

[Najeeb Mamini]

Tell and helps me feed my cat.

[Jonathan Jones]

So thank you from the center for Investigative Reporting and prx. This is revealing. I'm Al Ledson. In the initial days after the Coindesk article dropped, Sam Bankman Fried wasn't panicking. At least not yet. Hey, Sam, how's it going? Works great to see you. In fact, he was so not worried that he made this appearance virtually at a Forbes conference the day after the article came out.

[Sam Bankman Fried]

I would say things are stable. I'm cautiously optimistic, I would say.

[Jonathan Jones]

And it seemed like other people weren't worried either. He doesn't get asked a single question about his trading firm, Alameda Research. But then, four days after the article, a big shoe drops.

[Narrator/Reporter]

This just in. Binance founder CZ liquidating over $500 million.

[Jonathan Jones]

Worth of FTX positions Chompeng Zhao, who goes by CZ, is a Chinese Canadian crypto mogul. He ran Binance, the world's largest exchange and FTX's biggest rival. He'd been an early investor in FTX and still held about half a billion dollars of FTX's crypto tokens, known as FTT.

[Sam Bankman Fried]

CZ tweets out saying, roughly, this article came out, it gives us concerns, and because of those concerns, we're going to be selling all the FTT that we have left.

[Jonathan Jones]

CZ unloading half a billion dollars of FTT tokens signaled to his millions of followers and the market, it's time to get out.

[Sam Bankman Fried]

That was much more worrying because that's sort of how runs on the bank start.

[Jonathan Jones]

And that's exactly what happened. The panic spread, withdrawals surged, and inside FTX things began to spiral, reveals Jonathan Jones takes us back to those chaotic days.

[Narrator/Reporter]

Tarek Murad was one of the customers following the rumors swirling around FTX in the early days of November 2022.

[Najeeb Mamini]

The first time I heard of something fishy going on was through a guy I watch, a YouTuber called Eliotrades.

[Narrator/Reporter]

Okay, quick video update. Weird one. Right now on crypto Twitter, there is.

[Sam Bankman Fried]

An explosive amount of talk about FTX and whether or not they are in trouble. There's a bunch of FUD going on.

[Narrator/Reporter]

If you have.

[Najeeb Mamini]

And he said, you know, there's some FUD around and FUD is short for fear, uncertainty and doubt around FTX and the platform and, you know, people being able to withdraw their money. And he said, you know, I tried and I had no problems with it at all.

[Sam Bankman Fried]

As recently as today, I withdrew a significant amount of funds just to make sure that there wasn't any issue.

[Najeeb Mamini]

I thought, okay, well, he withdrew his funds. It worked for him. I'm sure everything's fine.

[Narrator/Reporter]

Of course, everything was not fine. FTX was in free fall. On a normal day, FTX customers might withdraw $50 million worldwide. On Sunday, November 6th, the day of CZ's tweet, customers, customers pulled out 2 billion.

[Sam Bankman Fried]

And then on the 7th, we had $4 billion of net customer withdrawals. So like 40 times as much as we'd ever seen in a day before.

[Narrator/Reporter]

The next day, Tarek had a long drive home from an out of town meeting.

[Najeeb Mamini]

So I started putting my YouTube stuff on and the things I typically listen to. And then I started hearing all the news about the exchange being frozen.

[Narrator/Reporter]

Confusion reigned. YouTubers were urging folks to pull out their money. But then Sam tweeted that everything was fine, that FTX had more than enough to cover withdrawals. Then he deleted it. When Tarek got home, he tried to withdraw a chunk of money he still had somewhere around $250,000 on the exchange.

[Najeeb Mamini]

I remember checking back, going to look, okay, did it go through? Did it go through? No, no, no. So then late, before I went to bed that night, it was probably closer to midnight, I tried to withdraw like the majority just pressed withdrawal, crossed my fingers, went to bed and woke up in the morning and nothing.

[Narrator/Reporter]

By that Tuesday, November 8, FTX had frozen all customer withdrawals. Tarek wasn't getting his money out. Inside the company, things were melting down. Despite assurances that Alameda Research, Sam's trading firm, and FTX were separate from each other, in reality, they were deeply entangled. The public didn't know this yet. Most Alameda and FTX employees didn't know this yet either. But inside Alameda, that was about to change.

[Sam Bankman Fried]

I guess you guys have probably seen a lot of what's happening on, I don't know, Slack and Twitter, but I could just like, start.

[Narrator/Reporter]

In the company's Hong Kong headquarters, around 15 employees sit in a circle at an all hands meeting. Others join on zoom. Caroline Nelson, the CEO of Alameda Research, walks in and sinks into a beanbag chair. She looks exhausted. She doesn't know that a new employee is secretly recording. Now, with the company disintegrating, she begins to confess.

[Sam Bankman Fried]

I think the basic story here is that starting last year, Alameda was kind of borrowing a bunch of money via open term loans and use that to make various illiquid investments.

[Narrator/Reporter]

Alameda had run out of money, so they started dipping into ftx, borrowing customers money without permission, which led to FTX.

[Sam Bankman Fried]

Having a shortfall in user funds.

[Narrator/Reporter]

Caroline says she thinks they'll probably close down Alameda, but maybe some of the employees can get jobs at ftx.

[Sam Bankman Fried]

I want to say, like, I'm sorry, this really sucks. It really sucks for all of you guys.

[Narrator/Reporter]

Employees fire off questions. How much Money is missing.

[Sam Bankman Fried]

Can you say how big the hole is? I probably just want to share the exact number. But it's.

[Jonathan Jones]

Is it closer to like one bill or six bill?

[Narrator/Reporter]

The latter. It would turn out to be more than 8 billion. Someone asks who knew who.

[Sam Bankman Fried]

Who else was like, aware of this? I mean, I guess like Sam shot it.

[Narrator/Reporter]

She doesn't finish the sentence. Someone asks what happens now. Caroline says she doesn't know. She thinks they might be bailed out by cz, of all people, Sam's biggest rival, the one who triggered the sell off in the first place. Then a tweet goes up. CZ has changed his mind. The deal is off. No one is coming to the rescue.

[Al Ledson]

11 o' clock at night, one of my colleagues called me and he said, said, make sure no one else is around.

[Narrator/Reporter]

While Caroline Ellison is talking to her staff in Hong Kong, the other Caroline, Caroline Papadopoulos, is home in California. She was the controller of ftx us, part of the leadership team on the accounting side.

[Al Ledson]

Someone had told our boss about that all hands meeting and there was extreme panic. And we got our other colleague on the phone and he said, I think we've been lied to. We didn't know the details. Somehow money is missing and we don't know who to trust.

[Narrator/Reporter]

Caroline says she and her colleagues turned to the one thing they had control of.

[Al Ledson]

The three of us stayed up all night preserving our accounting records. We were just backing everything up because.

[Sam Bankman Fried]

Wait, if we don't know who to.

[Al Ledson]

Trust, we want to make sure we have all the raw records in case anybody doctored anything.

[Narrator/Reporter]

Dan Chapsky, the company's head of data science, remembers rushing back to the Bahamas when he heard the company was dying.

[Jonathan Jones]

By the time I get there, many of the execs are just broken. They've been awake for days. A couple of people I know who were part of the leadership I saw on their way out in tears, kind of giving me a final hug before they left.

[Narrator/Reporter]

Sam's inner circle is panicking. Not just about money, but about potential criminal investigations.

[Jonathan Jones]

You could definitely feel in the air that perhaps there was something illegal that had happened that Sam had done or the leadership had done, and people didn't know if they had any liability or not, because they just didn't know.

[Narrator/Reporter]

On Wednesday, November 9, the same day as the Alameda All Hands meeting, Sam makes a key decision that he and his parents will come to regret. He agrees to retain Sullivan and Cromwell, the powerful law firm that had previously been advising FTX to prepare for a possible bankruptcy. The firm wants Sam to bring in a veteran crisis manager named John Ray as chief Restructuring Officer by the 9th.

[Sam Bankman Fried]

And 10th of November 2022 there's extremely large pressure on me coming from the law firm itself, from ex Sullivan and Cromwell lawyers who are working for ftx, from other advisors that they were routing their messages through and I it was quite intimidating.

[Narrator/Reporter]

Joe Bankman, Sam's dad, is already in the Bahamas. Barbara flies in the next day. At the urging of his parents, Sam hires a defense attorney. That same day, the Bahamas financial regulator freezes FTX's assets and takes control of the company's local operations. SAC Dexter, the head of the company's US division is sending frantic messages urging Sam to step aside. You have good people around you who can help you do the right thing, he tells Sam. I promise you doing this now will result in a far better outcome than doing something else. As pressure mounts for him to make a decision, Sam leans on the advice of his personal lawyers and his dad. Joe. I was there at 4:30 in the.

[Jonathan Jones]

Morning with Sam and I thought well.

[Narrator/Reporter]

This is a great law firm. They're not. Everybody's in the same boat here.

[Jonathan Jones]

We want to get new financing so.

[Narrator/Reporter]

That the employees and the stakeholders and.

[Jonathan Jones]

The investors all continue.

[Narrator/Reporter]

It might be that Sam ends up with nothing.

[Jonathan Jones]

That was frankly likely given this, but everybody else will be made whole.

[Narrator/Reporter]

So this was no longer even a about is torn. He is still trying to secure emergency funds to keep the company afloat, sometimes not responding to desperate messages from advisors. Deep down he doesn't want to step aside. But on the other hand I was.

[Sam Bankman Fried]

Thinking of that speech from Wolf of Wall Street.

[Narrator/Reporter]

In the Wolf of Wall Street, Leonardo DiCaprio plays Jordan Belfort, the embattled stockbroker. I want you to understand we don't do anything illegal whatsoever. You could talk to the SEC. They were at my office 15 times.

[Jonathan Jones]

Over the last six months.

[Narrator/Reporter]

So I mean I got nothing to hide. In a climactic scene as FBI agents close in on his offices, he gives a speech to his staff.

[Sam Bankman Fried]

See, I'm not fucking leaving speech.

[Najeeb Mamini]

So you know what?

[Jonathan Jones]

I'm not leaving. I'm not leaving.

[Sam Bankman Fried]

I'm not fucking leaving.

[Narrator/Reporter]

The show goes on.

[Sam Bankman Fried]

I was thinking I, I don't want to be that like I don't want to be the one clinging on to power when it's clear to the rest of the world that that shouldn't be what what they're doing.

[Narrator/Reporter]

So at 4:24am on Friday, November 11th Sam Bankman Fried signs the company over.

[Jonathan Jones]

What Sam doesn't realize at this moment he isn't just giving up control of ftx. He's also losing his ability to control the narrative about what went wrong. That's next on Reveal.

[Sam Bankman Fried]

America is changing and so is the world.

[Jonathan Jones]

But what's happening in America isn't just.

[Narrator/Reporter]

A cause of global upheaval. It's also a symptom of disruption that's happening everywhere.

[Sam Bankman Fried]

I'm Asma Khalid in Washington, D.C. i'm.

[Narrator/Reporter]

Tristan Redman in London and this is the Global Story.

[Sam Bankman Fried]

Every weekday we'll bring you a story from this intersection where the world and America meet.

[Narrator/Reporter]

Listen on BBC.com or wherever you get your podcasts.

[Jonathan Jones]

From the center for Investigative Reporting and prx. This is Reveal. I'm Al Ledsen. The day before handing over his crypto empire to a corporate crisis fixer named John Ray, Sam Bankman Fried did what he often did. He turned to Twitter. He posted an apology at 9:13am Then came 21 more tweets. Rapid fire all over the place and defensive. He said that he was sorry that he had, quote, f ed up. Then he tweeted that he was still fleshing out what had happened himself. The feed reads like a scattered monologue of panic, denial and analysis of his own culpability in real time. But two years later, the story he told Jonathan Jones was different.

[Sam Bankman Fried]

The single biggest mistake I made by far was handing the company over to Sullivan and Cromwell.

[Jonathan Jones]

Considering all the other decisions he'd made, the co mingling of funds, the lavish spending and dark money campaign contributions, that's really saying something.

[Sam Bankman Fried]

I made a decision and a large part of him was screaming at me that it was the wrong decision while I was making it and I should have just said no and put my.

[Jonathan Jones]

Foot down reveals Jonathan Jones spent months unraveling what happened in those critical moments in November 2022 and the aftermath.

[Narrator/Reporter]

He picks up the story after signing over his company. Sam still believes he'll be able to help fix ftx. And part of why he believes that is because Andrew Dieterich, a lawyer for Sullivan and Cromwell, said as much in an email to Sam two days before.

[Sam Bankman Fried]

You know, in that November 9th email.

[Narrator/Reporter]

Where he says, well, we're here to help you and you're going to go out and get new financing and you'll remain a director. Jonathan Lipson is a law professor at Temple University. He's spent decades studying big corporate bankruptcies, served as an expert witness in Enron, and represented victims interests in Purdue Pharma. He's closely studied the FTX case and Reviewed messages between Sam, Bankman, Fried and Sullivan and Cromwell. You know, Ray's just going to be here to help and you know you can terminate him whenever you want. In that email, Dieterich urges Sam to appoint a restructuring officer and attaches John Ray's resume for consideration. He writes, quote, we recommend Sam stay as a director, but over the next 36 hours, as the crisis deepens, they scrapped that plan. Dieterich later explained there wasn't time for endless board meetings and any delay could mean losing records or more assets. At a crypto bankruptcy panel in 2023, here's how he described those critical moments.

[Najeeb Mamini]

It was clear to us when we.

[Sam Bankman Fried]

Knew the depth of the problem, that we could not file with current management.

[Narrator/Reporter]

Having anything to do with the company. So we insisted on the replacement. So the document Sam signs at 4:24am on Friday, Nov. 11, makes John Ray not chief restructuring officer, but the new CEO.

[Sam Bankman Fried]

It's kind of a funny piece of paper, but there was something called the Omnibus Corporate Authority.

[Narrator/Reporter]

And it said, I, Sam Bankman Fried.

[Sam Bankman Fried]

As officer, director, shareholder, Pumbaa, authorized signatory, etcetera, of any of the following 130 companies, companies around the world hereby give all of my authority to John Ray and authorize him to appoint independent directors. And Sam signed that.

[Narrator/Reporter]

Within minutes after signing, Sam claims he tried to take it back. He says he'd just gotten a last minute offer of emergency funding from a crypto billionaire. Barbara Fried, Sam's mother, is there in the Bahamas as Sam contacts his personal legal team.

[Al Ledson]

And Sam called up his lawyers and said, you have to revoke my consent. And his lawyer made the phone call, it's too late, and went back to bed.

[Narrator/Reporter]

Sam's personal lawyers never informed Sullivan and Cromwell that he wanted to take it. Hours after taking control, John Ray files for bankruptcy, which would mean freezing the exchange and putting the company under court supervision. He also consolidates all of FTX's entities under US control, a move he later said was necessary to protect customer funds and stop the bleeding. Ray then proposes appointing Sullivan and Cromwell as bankruptcy counsel. If approved, the firm would lead the investigations into the apparent fraud and the recovery of funds to pay back customers. And they collect the massive legal fees that come with it.

[Sam Bankman Fried]

So if you get yourself in charge of bankruptcy, state, you can pay yourself. And the way bankruptcy law works, and this part was very unintuitive for me. All such payments take precedence over creditors, over customers.

[Narrator/Reporter]

And it wasn't just Sam. Later, critics would raise concern about Sullivan and Cromwell's appointment. After all, the firm hadn't just helped line Ray up, it had also spent years advising FTX before the collapse. On Twitter, Sam is still acting like he's in charge. Today I filed FTX, FTX US and Alameda for voluntary Chapter 11 proceedings in the US he posts. I'm really sorry again that we ended up here. Hopefully things can find a way to recover. My goal, my one goal is to do right by customers. But the man who's actually now in charge, John Ray, has no intention of letting Sam anywhere near FTX customers or their accounts in the days ahead. Sam keeps emailing, asking to talk. Ray never responds. Here he is speaking about his decision on Freakonomics Radio.

[Jonathan Jones]

It's pretty clear for me what happened in the company and what his role was. And I didn't really want to have any dialogue with him based on what I knew at the time.

[Narrator/Reporter]

Less than a week after taking over ftx, Ray files his first statement to the bankruptcy court, laying out the company's condition. He tells the court there had been virtually no board oversight and no centralized cash management system to track billions of dollars. Within hours, it goes viral. Quoted in headlines shared on Twitter, turned into memes. A damning, blunt assessment from the guy who handled Enron.

[Sam Bankman Fried]

FTX's new CEO is slamming Sam Bankman.

[Narrator/Reporter]

Fried Ray, who took over from disgraced founder Sam Bankman Fried. This is the man who oversaw Enron's bankruptcy.

[Al Ledson]

He had never seen, quote, such a.

[Narrator/Reporter]

Complete failure, such a complete absence of trustworthy financial information. This situation is unprecedented. Ray says he has no confidence in FTX's books and no way to know how much money customers would get back. That means pensioners, family foundations and others who have their savings on the exchange could lose everything. From his penthouse in the Bahamas and through his Twitter feed, Sam watches this play out, powerless to do anything to stop it. Can I ask you, when he first declared that FTX was a dumpster fire. Whatever. Worst accounting since Enron. When he makes that assessment publicly, how long has he been in charge?

[Sam Bankman Fried]

He'd been in charge for about a week. The first thing he did, his first policy decision, was to refuse to look at any of the accounting done by the company to decide he was all presumptively fraudulent and thus he was not even going to consider it.

[Narrator/Reporter]

Ray had brought in outside teams of forensic accountants, private investigators and cybersecurity specialists to look at the books. His conclusion was that the company's internal records were unreliable. But he'd also fired dozens of FTX staff, some of whom knew the company inside and out. Dan Chapsky, FTX's chief data scientist, was one of the last employees left. He believed the financials were messy, but there was trustworthy information if you knew how to find it.

[Jonathan Jones]

I was sending a lot of Slack messages and emails saying, hey, let me help you with this thing. I would love to help you. You don't have to give me any access to data. If you don't trust me for any reason, tell me where to go.

[Narrator/Reporter]

Like Sam, Dan believed many customers could have been repaid and the exchange restarted, maybe within weeks, if Ray and his team would just work with people inside the company.

[Jonathan Jones]

They had no idea what they were doing. They were just kind of looking at the data and hoping for the best.

[Narrator/Reporter]

Dan agreed with Sam, who was saying the money was there, just tied up, and that bankruptcy wasn't necessary. But the new leadership was saying something completely different. Bankruptcy was the only hope for customers, and Sam's claims were both reckless and false. Here's what Ryan Miller, general counsel of FTX US at the time and had to say about this on the original jurisdiction podcast.

[Sam Bankman Fried]

The reason the insolvency filing happened, from.

[Narrator/Reporter]

My perspective, was to bring stasis to.

[Sam Bankman Fried]

A situation where there was an extreme financial shortfall. It's an asset preservation and recovery exercise. Morning, everyone. Thank you. Please be seated.

[Narrator/Reporter]

Five days after Ray files his initial statement, FDX's bankruptcy case comes before Judge John Dorsey in Delaware and a packed zoom meeting of over 500 spectators.

[Sam Bankman Fried]

Before we begin, I wanted to make some announcements about conduct and decorum.

[Narrator/Reporter]

And in front of all those people, James Bromley, a lawyer for Sullivan and Cromwell, presents a damning assessment. FTX was in the control of a.

[Jonathan Jones]

Small group of inexperienced and unsophisticated individuals. And unfortunately, the evidence seems to indicate that some or all of them were also compromised individuals.

[Narrator/Reporter]

And in case anyone didn't get the point. So, your honor, what we have is.

[Jonathan Jones]

A worldwide organization that was run effectively as a personal fiefdom of Sam Bankman Fried.

[Narrator/Reporter]

Sam is not at the hearing, but he wants to be heard. He continues speaking up through a flood of tweets. He reposts claims that the bankruptcy team is motivated by potential millions in legal and consulting fees. He arranges a handful of interviews where he can try to defend himself, even if it means having to apologize.

[Sam Bankman Fried]

At the end of the day, I was CEO of ftx and that means whatever happened, why ever it happened, I had a duty. I had a duty to all of our stakeholders, to our customers, to.

[Narrator/Reporter]

This is from a live interview at a conference with the New York Times writer Andrew Ross Sorkin.

[Sam Bankman Fried]

I didn't ever try to commit fraud on anyone. I. I was excited about the prospects of FTX a month ago. I was shocked by what happened this month. What.

[Narrator/Reporter]

What are your lawyers telling you right now? Are they suggesting this is a good idea for you to be speaking?

[Sam Bankman Fried]

No, they are very much not.

[Narrator/Reporter]

Sam's media offensive is all happening under the threat of criminal prosecution. It's already all over the news. The DOJ had opened an investigation into ftx. What isn't in the news? Sullivan and Cromwell, the law firm representing ftx, had begun communicating with federal prosecutors before Sam handed over control of the company. Later, in a sworn declaration, Andrew Dieterich, an attorney for Sullivan and Cromwell, said the firm had reported concerns with reconciling the balance sheets, and they had done so in consultation with FTX's senior lawyer, Ryan Miller. Law professor Jonathan Lipson says, as any lawyer who's listening to this knows, you don't go to prosecutors about your client without informing your client. There are some narrow exceptions, like to stop a crime or if your client consents. Lipson says the issue was the timing, a point he and other critics made in the legal brief. Sullivan and Cromwell was talking to prosecutors about FTX accounting issues at the same time they were advising Sam on navigating the crisis. And DOJ prosecutors told Sullivan and Cromwell they wanted more information. Balance sheets, customer agreements, a list of.

[Sam Bankman Fried]

Employees, information they can give them to help make a case, a criminal case.

[Narrator/Reporter]

The questions are about ftx, but they don't send them to Sam.

[Sam Bankman Fried]

It's a questionnaire for ftx, the company, but they send it to Sullivan and Cromwell, the law firm.

[Narrator/Reporter]

And this is prior to you signing over the company?

[Sam Bankman Fried]

That's correct. So I was still CEO at this point. I was not aware of this happening.

[Narrator/Reporter]

Sam says the lawyers who were supposed to be representing his company were now working with the prosecutors who were building a criminal case against him. In courtroom testimony, John Ray said that Sullivan and Cromwell's cooperation with prosecutors was both legally required and in the best interest of FTX customers. An independent examiner also later rejected Lipson's concerns about the firm's actions the week of the collapse, including its disclosures to prosecutors about accounting issues, describing it as a prudent and commonplace strategy. Jonathan Lipson believes Sam may have decided not to hand over the company to John Ray if he'd known about the meeting with prosecutors. Now, if Sam had been fully informed that they'd gone to prosecutors at the time he signed all these powers over to Ray, I'd be like, oh, I'm really sorry, Sam, but that's life. You shouldn't have done that. That was a mistake. Bad on you. But there's no evidence that Bankman Fried was ever told about this, and Bankman.

[Jonathan Jones]

Fried insists that he wasn't.

[Narrator/Reporter]

The whole situation had also raised the interests of lawmakers, including Representative Maxine Waters, the chair of the House Financial Services Committee. Weeks after the collapse, she called for a hearing on FTX to understand what went wrong and assess regulatory failures. She even tagged Sam in a tweet publicly inviting him to testify before Congress.

[Sam Bankman Fried]

And I was very much looking forward to the opportunity to testify. And it was gonna be a very contentious hearing.

[Narrator/Reporter]

The plan was for John, Ray and Sam to appear back to back.

[Sam Bankman Fried]

I don't anticipate that. Ray and I would agree, not very much, Melissa. We've gotten sort of my side out and there were a lot of congressmen who were very interested, I think, at the time, in hearing what had happened.

[Narrator/Reporter]

The night before the hearing, Sam is in his Bahamas penthouse and I get.

[Sam Bankman Fried]

A phone call from my lawyers that in 45 minutes I was going to be arrested. And that is, in fact, what happened. I was arrested by Bahamian police at the request of the United States Department of Justice.

[Narrator/Reporter]

Sam's mom Barbara is there when he's arrested and she watches as he's taken away to jail to be booked.

[Al Ledson]

We went to the jail where he's being held overnight. They wouldn't let us see him. You know, one of the guards who could not let us in said, I promise I will tell him you came. And when we came back in the morning to drop off a suit for him to wear to court, they wouldn't let us see him. They couldn't let us see him. But one of them said to us, just remember, the sun will shine tomorrow.

[Narrator/Reporter]

The next day, back In New York, U.S. attorney Damian Williams gives a triumphant press conference. Bankman Fried and his co conspirators stole billions of dollars from FTX customers. He used that money for his personal benefit, including. Prosecutors are sending a message to anyone who participated in wrongdoing at FTX or Alameda Research and who has not yet come forward. I would strongly encourage you to come.

[Jonathan Jones]

See us before we come see you. And they did. Almost everyone in Sam's inner circle flipped and testified against him. Ten months after his arrest, a jury found Sam Bankman Fried guilty of Franklin fraud, conspiracy and money laundering. He was sentenced to 25 years in prison. Sam has appealed his conviction, which is scheduled to be heard in court this fall. But Sam's arrest and conviction was not the end of the FTX story. Customers around the world had lost access to their money, and the bankruptcy court would determine what, if anything, they'd get back. And as the case dragged on, questions about how the bankruptcy was being run and who was running it only grew louder.

[Sam Bankman Fried]

It's like an aggressive tactic, like try.

[Narrator/Reporter]

To exclude people from the bankruptcy because.

[Sam Bankman Fried]

They don't do the paperwork right, set up artificial deadlines, stuff like that.

[Al Ledson]

I was fuming. I was furious because these people, they were playing around with our lives, with our money.

[Jonathan Jones]

Join us next time for part two of the Secret Story of FTX Rise and Ruin. To see original documents related to the FTX collapse and the bankruptcy, Visit our website, revealnews.org Our story was reported by Jonathan Jones. The lead producer is Sophie Bridges. She had help from artist Cheriscus and David Richer. Taki Telenides edited the show with additional editing from Daniel Shulman, archival research by Julia Haney. Sarah Solagi is our fact checker. Victoria Baranetsky is our general counsel. Our production manager is the great Zulema Cobb. Score and sound design by the dynamic duo Jay Breezy, Mr. Jim Briggs and Fernando My Man Yo Arruda. They had help from Claire C. Note Mullen. Our executive producer is Bret Myers. Our theme music is by Camerado Lightning. Support for reveals provided by the Riva and David Logan foundation, the John D. And Catherine T. McCl Arthur foundation, the Jonathan Logan Family foundation, the Robert Wood Johnson foundation, the park foundation, the Schmidt Family foundation and the Hellman Foundation. Support for reveal is also provided by you our listeners. We are a co production of the center for Investigative Reporting and prx. I'm Al Ledson and remember there is always more to the story.

[Narrator/Reporter]

From prx.