The FTX management said in a Monday report that $7 billion has been recovered from the company’s illiquid assets. The statement comes about a year after the company filed for bankruptcy. The management of the company also alleged that the previous management was commingling funds while making misrepresentations to bank officials who questioned whether the funds of FTX and Alameda were being mixed.
“From the inception of the FTX.com exchange, the FTX Group commingled customer deposits and corporate funds, and misused them with abandon at the direction and by the design of previous senior executives,” John J. Ray III, chief executive officer and chief restructuring officer of many bankrupt FTX entities, said in a statement.
The update from the management also alleged that the former FTX officials fired an employee who questioned the practice. With the recovered illiquid assets, the company’s liabilities are currently $15 billion. This means that FTX customers have hopes of recovering about 40% of their funds at the moment.
When FTX filed for bankruptcy, its liabilities totaled approximately $8.7 billion. Caroline Ellison, the former CEO of Alameda Research, showed through some private notes that the company’s account had a deficit of $10 billion by March 2022.
A report by Bloomberg said that despite the commingling of FTX and Alameda funds, the company’s real problem stemmed from the mismanagement of customers’ funds.