This Guy’s a Fraud of Historic Proportions

What is this disreputable little newsletter but a chronicle of human nature?

More specifically, it is a chronicle of fallen human nature — of man’s long and agonized descent from the paradise of Eden.

It is a chronicle of man’s skyvaulting ambition. Of his fathomless greed. Of his ceaseless dragooning and clubbing of fellow men.

In brief… The Daily Reckoning is a chronicle of man’s abominable propensity to sin.

History’s rogue’s gallery is accordingly extensive.

See for example Mr. John Law and his Mississippi swindle. See for example Charles Ponzi and his eponymous scheme. See for example Mr. Bernard Lawrence Madoff and his fantastic impersonation of the aforesaid Ponzi.

Here are but some of history’s more recognized scoundrels, knaves, sharpers and confidence men. A comprehensive list would stretch this article to several dozen pages, each single-spaced and finely printed.

All roast presently in hell.

Today we are pleased to add a living villain to our list — a certain Sam Bankman-Fried — former chief executive officer of FTX Trading Ltd.

FTX Trading Ltd. is the popular cryptocurrency exchange presently seizing headlines for defrauding investors. And for defrauding them handsomely.

The complete story is yet to be written. The FTX tentacles likely span far, wide — and deep.

Our spies even report salacious rumors of money-laundering operations involving FTX, the Democratic Party and the nation of Ukraine.

We cannot confirm these and other whispers at this time. Thus we had best keep them dark.

Yet here Crypto Briefing gives the skeleton facts, the acknowledged facts:

Former FTX CEO Sam Bankman-Fried secretly used customer funds to bail out FTX’s sister company Alameda Research, resulting in an estimated $10 billion hole in the exchange’s books. To make matters worse, Bankman-Fried covered up his fraudulent activities for months, leaving investors, customers and even his own employees in the dark right up until FTX declared bankruptcy on Nov. 10… Now the company is bankrupt and owes billions to creditors, and FTX shares are almost certainly worthless.


It’s hard to estimate how much customers holding funds on FTX lost as reports vary, but the number is likely to be in the billions. The figure will likely have been made worse by Bankman-Fried’s since-deleted tweets in the lead-up to FTX’s bankruptcy. The former FTX CEO assured users that assets held on the exchange were fully backed at 1:1, dissuading users from withdrawing funds. In hindsight, these tweets turned out to be bald-faced lies.

Mr. Bankman-Fried presently confronts a class action lawsuit by pitchfork-carrying investors.

These include such eminentos as football player Tom Brady, his soon-to-be-former wife Gisele Bündchen, the basketball players past and present Shaquille O’Neal and Stephen Curry and Shark Tank personality Kevin O’Leary, to name but some.

We wish them every godspeed.

Yet we are vastly grateful for the fraud that is the young Sam Bankman-Fried.

That is because he validates our iron disbelief in our fellow man. And a man is always grateful when his deepest convictions are affirmed. It warms and soothes him… as a cozy fire may warm and soothe him of a winter’s evening.

Meantime, this fellow furnishes freshly hatched proof that another great fraud is always somewhere in the wings, awaiting only his inevitable discovery.

Thus we are assured we will always have a story to cover. Because of the Sam Bankman-Frieds of this world, we are perpetually in motion.

Combine them with the other fools, popinjays, world improvers, lunatics and lesser scoundrels on daily display… we well and truly loll in clover.

Of course we can afford to extend our gratitude to Mr. Bankman-Fried. We were not among the defrauded and fleeced whom he cleaned out.

Yet we can extend his victims this one consolation:

Like Law, like Ponzi, like Madoff and the others, he too will roast. The Old Boy will collar him.

This realization will not restore your losses of course. Alas, they have vanished forever into the ether.

Yet even the grayest storm cloud has its silver lining…

The Daily Reckoning