Sam Bankman-Fried on the Alleged "Backdoor"
Sam Bankman-Fried on the Alleged "Backdoor"
SBF on the alleged “backdoor” allowing him to execute commands that could alter the company’s financial records without alerting others.
I asked Sam Bankman-Fried, former CEO of FTX, about the implementation of an alleged “backdoor” allowing him to execute commands that could alter the company’s financial records without alerting others. According to Reuters, this set-up allowed for the movement of $10 billion in funds to Alameda without triggering internal compliance or account red flags at FTX.
SBF denied implementing a “backdoor”, noting that he does not code so would not be capable of intentionally build a backdoor into the system himself. Sam did, however, acknowledge the “nearest neighbor” to the claim, which he described as a “very poorly labeled accounting thing, which was a historical artifact of a time before FTX had bank accounts”. Allegedly this accounting “fuck-up”, allowed people to “wire money to Alameda and actively credit it on FTX”. According to Sam, this accounting error was never corrected and caused Alameda to be “substantially more levered than [he] thought it was.” Ultimately, Sam claims this caused him to be wrong on Alameda’s balances on FTX by “an embarrassingly large number” and for Alameda to become “substantially more levered than [he] thought it was”. He suggested that the rumored “backdoor” likely “went through a number of games of telephone before ending up like that”.
(Phone Call November 16, 2022)
Note: I intend to remain impartial on any information I share from my phone calls with SBF, but please don’t mistake my neutrality for naiveté. I take all of Sam’s responses with a grain of salt. I am NOT a journalist, nor am I paid to post anything. I’ve previously shared some context for our phone calls, as well as hard evidence for verification.
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