After the FTX cryptocurrency exchange failed, the platform’s founder, Sam Bankman-Fried (SBF), is going on a media tour to try to explain what happened. Bankman-Fried has been warned about the plan, though.
As the investigation into the collapse continues, Ira Sorkin, who represented Bernie Madoff, who ran the biggest individual Ponzi scheme, has told Bankman-Fried to “shut up,” Bloomberg reported on December 2.
According to the attorney, the Bankman-Fried media tour will have little impact on swaying public opinion over his alleged role in the FTX debacle.
“That’s the first order of business: don’t talk. You’re not going to sway the public. The only people that are going to listen to what you have to say are regulators and prosecutors,” Sorkin said.
At the same time, Sorkin stated that Bankman-Fried might be going against the advice of his lawyers. According to Sorkin:
“Sometimes clients believe they are smarter than their lawyers. This guy is 30 years old, and he is not smarter than his lawyers. They should be telling him every five minutes to shut up, but sometimes clients don’t listen.”
Bankman-Fried said in his first-ever audio interview that his legal team told him not to explain what happened before the collapse on Twitter.
Throughout the media tours, Bankman-Fried has insisted that he did nothing wrong. He has denied any wrongdoing and said that he was caught off guard by the collapse.
SBF has been busy on Twitter Spaces as well as going on media tours. In a recent appearance, SBF was asked to explain why he asked for $4 billion in his first call to help the exchange avoid going bankrupt. He gave a vague answer.
SBF is still being accused of stealing customer money, and some people in the market think he was running a Ponzi scheme.
Finbold said that former Securities and Exchange Commission (SEC) employee John Reed said that the collapse of FTX was worse than the Bernie Madoff Ponzi scheme. Interestingly, Robert Kiyosaki, who wrote the book “Rich Dad, Poor Dad” about money, also compared the collapse of FTX to the Ponzi scheme run by Bernie Madoff.
Notably, Bankman-Fried and the people who used to promote FTX are being sued by a group of consumers for $11 billion. The exchange is accused of breaking the rules when it comes to crypto accounts that pay out interest.