I Know folks, the entire Financial media cycle as of recent has been dominated by FTX and particularly the insanity of the previous CEO the psychopath. Sam Bankman Free every day. You ask yourself, there's no way it can top the previous day's news. Well, another day has come and we didn't just top what's been going on recently. We are so far into the world of insanity. if I didn't read the court filings myself, I would have never believed what just went down. You gotta check this out. foreign so to kick it off, quick reminder: Sam Bateman Freed basically was using a bunch of his clients funds at FTX and then was chasing some bad bets and got himself further and further into a hole. This is classic fraud I Wouldn't say it's so specific to crypto, but this is really an Old-fashioned He was running a bank. it just happened to be a crypto Bank in exchange and then he kind of just went completely Haywire with it. But anyway, recently, just chilling in the Bahamas enjoying the sunshine, acting as if just because of his actions, billions of dollars didn't disappear into the ether. Well check this out. Emojis for expenses, penthouses, and slip shot accounting The most damning details from the new Ftx's CEOs report. When I read this I went over their details and I knew I needed to read it for myself. But instantaneously we saw: Wild headlines: Sam Bakeman Freedom Company He he owns a 3.3 billion in loans from his Alameda trading firm according to the filing. On top of that, a new bankruptcy filing shows that the value of Fdx's crypto Holdings is just 659 000 After the embarrassed CEO SBF said they were worth 5.5 Well, that's pretty awkward. Sam Bateman Free transferred assets to the Bahamas government custody after the bankruptcy and right away you start looking into that and you're like dude, is he using client funds to pay off a government entity so they don't extradite them back into the U.S are the Bahamas government or Regulators now in on this? Are they getting their slice of the pie I mean this was literally breaking news just before we started today's stream. Just in FDX co-founder files emergency legal document alleging Bahamas Regulators instructed Sam bankman freed to transfer company assets to the government. Is the government now involved in it like I'm saying this story is just getting so wild. It's going to be a multi-part documentary to possibly explain everything that is going on. But what I need to show? you are some of my absolute favorite parts of the bankruptcy court filing. So right here this is District of Delaware we have: John J Ray III This guy's a heavy hitter. He's the dude who helped do the restructuring of like Enron this is a very serious guy. You call them in when part of your financial sector is probably completely on tilt like this is a very serious dude who is currently the acting CEO for FTX trying to figure out the restructuring and this is I would say kind of his legal SEC lawyer diary rendition of the current state of FTX And as you're going to see as I continue through each one, your jaw is going to get closer and closer and closer to the floor because it is truly that. Bonkers Started off right here. This is from John Ray the guy trying to fix this entire debacle. Never in my career have I seen such a complete failure of corporate controls and such a complete absence of trustworthy financial information as occurred here. From compromised systems of Integrity faulty regulatory oversight board, to the concentration of controls in the hands of a very small group of inexperienced, unsophisticated, and potentially compromised individuals, this situation is unprecedented. Let me remind you, these are the words from the guy that handled the entire Enron crisis. He is saying this is so far beyond that that it's unprecedented before. I mean analogies of it's the Modern Day Enron It's the Modern Day Bernie Madoff And little did I know that I was wrong, but I was wrong in the wrong direction. It's even worse than that. You have to appreciate how truly insane saying that is and that's exactly why I need to show you some of my favorites. so Numero Uno out of the gate related party loans receivable of 4.1 billion with a B at Alameda research. Remember that's a hedge fund that was kind of the sister company that. apparently there was no distinction between the two, even though legally there was supposed to be. so. anyway, just in terms of loans they gave our boys Sam Bakeman freed just just one billion. A cool one billion to the CEO just to do whatever he needs with because hey, he needs some pocket money. Why not? You might think that's insane, but as you're about to find out, you almost wish it just stopped there. The FTX groups approach to Human Resources combined employees of various entities and outside contractors with unclear records and lines of responsibility. At this time, the debtors have been unable to prepare a complete list of who worked for FTX group as of the petition date or the terms of their employment. Repeated the 10 to locate certain presumed employees to confirm their status have been unsuccessful to date. They don't even know who worked for the company whatsoever. They don't know what they did, what was going on, the human resource department Completely non-existent. The debtors did not have the type of disbursement controls that I believed are appropriate for business. Enterprise For example, employees of the FTX group submitted payment requests through an online chat platform were a disparate group of Supervisors approved disbursements for responding with personalized emojis. So they're like, hey man, I need some money because I just bought a random thing and they're like cool But they didn't even say cool with the letters. they just hit them with an emoji and covered the bill. And it was completely random in the Bahamas I Understand that corporate funds of the FTX group were used to purchase homes and other personal items for employees and advisors. This one is so big that I need to repeat it one more time in the Bahamas I Understand that corporate funds of the FTX group were used to purchase homes and other personal items for employees and advisors. I Understand that there does not appear to be documentation of certain of these transactions as loans and that certain real estate was recorded in the personal name of these employees and advisors on records of the Bahamas. This is just getting so stupidly wild. The FDX group did not approach keep appropriate books or records or security controls with respect to digital assets. This is a crypto. Bank This is a crypto exchange that was not keeping track of the digital assets that they had the use of software to conceal the misuse of customer funds, the secret exemption of Alameda from certain aspects of Ftxs.com Auto Liquidation protocol, and the absence of independent governance as between Alameda and also Ftx.com Silo So right here the secret software. So the rest of the world didn't know they were misusing customer funds. Alameda When other people get stomped out because of like their leverage, it's being too bad. Alameda had an exception. They were never going to get margin called or stomped out or anything like that and just clearly we already knew this. But like there was just there was supposed to be independent businesses FTX on one side Alameda Two independent businesses And here it's like there was literally no difference between the two. These balances exclude cryptocurrency not currently under the debtor's control as a result of at least 372 million of unauthorized transfers initiated on the petition date. So basically they filed for bankruptcy and 372 million. This poof disappeared. Gone, basically almost 400 million was taken at the last second during which the time the debtors immediately began moving cryptocurrency into Cold Storage to mitigate the risk of to the remaining cryptocurrency that was accessible at at that time. Folks I don't know how much more I need to read to you for everyone to like, truly understand the size of Fraud and psychopathy that was going on in this. The FDX group had billions in Investments other than cryptocurrency as suggested above in the descriptions of the four silos, however, the main companies in the Almeda Silo and the adventure Silo did not keep complete books and records of their Investments and activities no books, no accounting Investments activities, digital assets in just nowhere, it does not exist. One of the most pervasive failures of the Ftx.com business, in particular is the absence of lasting records of decision making the previous CEO Binkman freed often communicated by using applications that were set to Auto delete after a short period of time and encourage employees to do the same if that's not Sus I don't know what is and then finally, the crowning explanation to all of us. the crowning detail that you need to know about this story. Finally and critically, the debtors have made clear to employees and the public that the previous CEO Bateman Freed is not employed by the debtors and does not speak for them. Bakeman Freed currently in the Bahamas continues to make erratic and misleading public statements. Mr Bateman Freed whose connections and financial Holdings in the Bahamas remain unclear to me. Recently stated to a reporter F Regulators they make everything worse and suggested the next step for him was to win a jurisdictional battle versus Delaware F Regulators That's the big old statement F Regulators After committing potentially one of the biggest cases of fraud ever known to man, the official comment on it is F Regulators Now with all this Insanity you might be thinking to yourself, why is he not arrested Well, a little bit of an update on that Manhattan U.S Attorney's Office preparing criminal charges against SBF and FTX for defrauding customers. So as of now, he is not in prison. He does not have handcuffs on. In fact, he's not even in the country. He's expected to come in December to do various panels with Congress house committee and a senate committee. but is it going to happen? I Have absolutely no clue it should happen if you ask me and obviously I want to get your thoughts in a comment that twists and turns that this is taking I Can tell you I will be the first person in line to watch the documentary that is made of this pure unadulterated insanity.