- The FTX whistleblower has been revealed as high-ranking FTX executive Ryan Salame
- Salame told told the Securities Commission of the Bahamas about the commingling of funds
- This whistleblowing came on the day that Binance pulled out of a potential deal to buy FTX
High-ranking FTX executive Ryan Salame has been revealed as the whistleblower who tipped off Bahamian regulators about the potential fraud being perpetrated by the company just 48 hours before it was forced to close last month. Court records filed yesterday reveal that Salame, who was working as co-CEO of FTX Digital Markets (FDM) at the time, told the Securities Commission of the Bahamas (SCB) on November 9 of the incestuous relationship between FTX’s hedge fund Alameda Research and FTX and will collect either part of the $20 million being offered to FTX whistleblowers following its demise.
Salame Informed SCB ABout Fund Commingling
Salame’s actions came on the day that Binance stepped away from a potential deal to salvage FTX, the point at which many believed the curtains were almost certainly going to come down. He told the SCB that customer funds were being sent from FTX to Alameda to “cover financial losses” suffered by the hedge fund, most likely due to the collapse in the value of FTT, and that the transfer was “not allowed or consented to by their clients.”
Salame also told the SCB only three people had the requisite access in order to facilitate the move – then-CEO Sam Bankman-Fried, FTX co-founder Zixiao “Gary” Wang, and FTX engineer Nishad Singh. Following this information, SCB executive director Christina Rolle contacted the commissioner of the Royal Bahamas Police Force to request an investigation, given that the information “may constitute misappropriation, theft, fraud or some other crime.”
FDM’s assets were frozen by the SCB the following day, with its registration also suspended and a provisional liquidator appointed in an attempt to preserve the company’s assets. This is the first known occasion where an executive from FTX or Alameda assisted authorities, although the $20 million whistleblower pot has almost certainly convinced others to come forward.
Former Marketing Employee Reveals “Cult Like” Atmosphere
Meanwhile, Danielle Cloud, a former FTX employee who claimed to work in the marketing department, has posted a series of tweets detailing aspects of her time working with the company:
1. My ex – FTX 🧵
Two(ish) weeks ago, I formally resigned from my position as an FTX employee.
— Dani Cloud (@daniiicloud) December 13, 2022
In the tweets, Cloud revealed how things “felt off” right from the outset, calling the experience “cult like” and saying that the company was “iconically and moronically inefficient—but equally mesmerizing.” Cloud said that the rumors of frequent bunk ups are probably just that, having never witnesses [sic] anything, and that the workload was intense and perpetual.
Cloud ends the thread by saying that Bankman-Fried “didn’t do it alone”, adding that, despite various advantages, “he still could not have gotten this far without the support of strangers worldwide.”
Who those strangers were we may well find out in the coming months.