‘Complete Failure’: CEO Who Oversaw Enron’s Collapse Says FTX’s Is Even Worse

Former Enron CEO John J. Ray III, who oversaw the company during its historic collapse in the early 2000s, told a Delaware court that the collapse of cryptocurrency exchange FTX was worse than anything he had ever seen, according to court documents Thursday.

Ray, who took over as CEO from founder Sam Bankman-Fried when the company filed for bankruptcy on Nov. 11, following a liquidity crunch and reports that Bankman-Fried was loaning billions of dollars worth of customers’ assets from FTX to one of his other companies. He is perhaps most well known for recovering more money than was expected on behalf of energy firm Enron’s creditors during its $23 billion bankruptcy proceedings, and has acquired a reputation for improving creditors’ recoveries, according to Reuters Nov. 15. 

“Never in my career have I seen such a complete failure of corporate controls and such a complete absence of trustworthy financial information as occurred here,” Ray said in a court filing Thursday. “From compromised systems integrity and faulty regulatory oversight abroad, to the concentration of control in the hands of a very small group of inexperienced, unsophisticated and potentially compromised individuals, this situation is unprecedented.”