When they make the FTX limited series for TV — scripts for which are almost certainly already in the works in at least five different studios, if I had to guess — the most fun scenes will be the flashbacks. The startup in its heyday, flush with cash and showering employees with gifts in the form of luxury hotel stays, parties, bottomless boozy outings. I can already picture the slow fade from the beach party at Jimmy Buffet's Margaritaville to the rat-infested jail where Sam Bankman-Fried spent a week between his arrest and extradition to the United States.
(And seriously, for any HBO or Netflix producers out there: DM me and I'll happily drop this whole journalism thing to go full Hollywood…)
Anyway, the source material for those scenes is beginning to surface via FTX's bankruptcy proceedings, giving the public a quantitative look at just what happens when a bunch of 20- and 30-somethings who think they're saving the world end up with billions of dollars at their disposal.
See here: FTX, the crypto exchange platform that went bust in November, spent about $40 million in just over nine months last year on hotels, entertainment and flights, according to court documents reviewed by Insider. Nearly $7 million of that was just food.
The largest chunk, totaling about $5.8 million, was spent at an oceanside resort called the Albany Hotel, where Bankman-Fried previously lived in a $30 million penthouse.
Keep in mind, this is all taking place within a company that had no centralized cash controls, would send expenses and invoices over Slack, and ran its accounting on QuickBooks.
Here's perhaps my favorite example, reported by the Financial Times: When FTX moved its headquarters from Hong Kong to the Bahamas last year, the staff soon realized that Amazon didn't deliver to the island. So they struck a private deal with an air carrier to fly their orders from Miami, according to former employees. More from the FT:
A lack of internal controls that are typical of large financial companies meant FTX's spending went largely unchecked, according to former employees and filings in the group's Delaware bankruptcy case. "[It was] kids leading kids," said one former employee.
"The entire operation was idiotically inefficient, but equally mesmerising," they added. "I had never witnessed so much money in my life. I don't think anybody had, including SBF."
Last week, SBF pleaded not guilty to federal charges that he stole customer funds from FTX to underwrite his lavish lifestyle as well as to cover losses at his hedge fund, Alameda, and make political contributions.
In a series of interviews since FTX's collapse in November, SBF has sought to portray himself as a fundamentally good guy but a hapless businessman who got out over his skis.
Lawyers could have a field day spinning the expenses narrative in any number of directions. Certainly, if the defense does lean into the whole "I was a stupid 29-year-old whom no one should have trusted with money" argument, well, it appears there's some evidence to back that up.
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