ray: enron was a different company. the crimes that were committed there were highly orchestrated financial machinations by highly sophisticated people to keep transactions off balance sheets. this is really old-fashioned embezzlement. this is taking money from customers and using it for your own purpose. it's not sophisticated at all. sophisticated perhaps in the way they were able to hide it from people. frankly, right in front of their eyes. but this is not sophisticated whatsoever. it's just plain old embezzlement. >> old-school. mr. ray: bold school. >> it seems like there were some interesting ideas how to stay relevant in the crypto world. i have read that he wants to be retained as an outside consultant and has been critical of your own appointment, quite frankly into this position so after his arrest last night, all his wishes seem even more unlikely. what role, if any, should he play in ftx moving forward? mr. ray: the role he is currently playing, zero. >> you stated that ftx was a platform allowing for users

ray: enron was a really different company. crimes that were committed there were highly orchestrated, financial machinations, by highly sophisticated people. to keep transactions off balance sheets. this is really old-fashioned embezzlement. this is just taking money from customers and using it for your own purpose. not sophisticated at all. sophisticated perhaps in the way they were able to hide it from people. frankly right in front of their eyes. this isn't sophisticated whatsoever. this is just plain old embezzlement. mr. williams: old school. mr. ray: old school. mr. williams: there you go. it seems like fried had some interesting ideas how he can stay relevant in the f.t.x. world. even after stealing customers money and driving k-pt to bankruptcy. i have read he wants to be retained as an outside consultant. and been very critical of your own appointment, quite frankly, into this position. after last night all his wishes seem more unlikely. what role, if any, should he play in f.t.x. moving forward? mr. ray: the role he'

you have a unique perspective because of the fact you worked on the enron conspiracy. i would be interested to see how you think it compares. you got cut you have earlier and i'd like to hear about that. >> enron was a different company. you know, was a -- crimes that were committed there were highly orchestrated financial match nations by highly sophisticated people to keep transactions off balance sheets you know, this is really old-fashioned embezzlement this is just taking money from customers and using it for your own purpose. not sophisticated at all sophisticated is perhaps in the way they were able to sort of hide it from people. frankly right in front of their eyes but this isn't -- this isn't, you know, sophisticated whatsoever this is just plain old embezzlement, old school. >> old school, there you go. it seems like he had interesting ideas on how to stay relevant in the ftx world. even after stealing customers money and driving it into bankruptcy i have read he wants to be retained as an outside consultant and critical of your appointment into his position

enron maybe had two sets of books. ftx had no set of books, emojis that they would slack back and forth about expenses. this is a mess. this is absolutely a mess and i think sam bankman-fried's strategy if you look at his bizarre media appearances today has basically been to try to convince the world that this was not deliberate fraud. this was incompetence. we were just kids. we didn't know what we were doing, you know. whatever and, look, obviously they were sloppy, obviously. but those kinds of excuses are maybe more palatable if you're running a lemonade stand instead of a billion dollar company. >> what's the impact? i apologize for laughing. a lot of us saw this come along saying here's a chance it was sold to them for the modern amount of money to get involved in the next big thing. pew did a survey that said 16% invested in crypto. 71% said no. 12% said they haven't heard of it. i was surprised 16% seemed a little high to me. what is the impact for somebody out there whether it was $200 or $10,000, $20,000, wha

you have compared ftx as worse than enron. can you elaborate on some of the specific ways that ftx is worse than one of the largest corporate frauds in history? mr. ray: the ftx group is unusual in the sense -- and i have done probably a dozen large-scale bankruptcies over my career, including enron, of course. every one of those entities had some financial problem or another. they had some characteristics that are in common. this one is unusual in the sense that literally, there is no record-keeping whatsoever. the absence of record-keeping, employees would communicate invoicing and expenses on slack, which is essentially a way of communicating through chat rooms. they used quickbooks a multi billion dollar company using quickbooks? quick books. nothing against quickbooks. a very nice tool. just not for a multi billion dollar company. there is no independent board, right? we had one person really controlling this. no independent board. that is highly unusual for this size company. this is made all the more complex because we

taxation a credible experience organization that has conducted similar reviews in the past such as the enron investigation. to review fully and with adequate time the irs presidential mandatory audit process and to bring back the analysis from congress within 90 days. we provide an alternative that focuses on the purported reason for this, for releasing these tax returns without creating a new precedent that can jeopardize the privacy of every american. with that, questions? yes, sir. >> [indiscernible] what exactly was in the report they are submitting to the full house? [indiscernible] >> in summary they were -- the tax returns, president trump for six years including the tax returns of eight affiliated businesses. it also included the audit notes . what became clear is that almost all those audits the irs is doing is not yet complete. any characterizations of the returns themselves, you have to acknowledge, this is incomplete at this time. it does have the returns themselves and what else? the irs audit report. excuse me. the majority report. sort of a rushed analysis of on taxation which

he was hired after the enron financial disaster and ray says this is worse than enron. congress ftx and sam bankman-fried didn't keep records on millions or billions of dollars. >>> there's no record keeping whatsoever. the absence of record keeping. employees would communicate invoicing and expenses on slack which is essentially a way of communicating for chatrooms. they use quickbooks, a multibillion dollar company. >> quickbooks? >> quickbooks. nothing against quickbooks. a very nice tool. just not for a multibillion dollar company. >>> twitter is not paying its bills according to a number of reports including rent on its offices and elon musk thinking about not paying laid off workers severance as required by law and by the agreement with twitter. if you do something for twitter, construction services, you may want to get paid ahead of time. in a day full of news, apple working on a system to allow users in europe to load apps on their iphone without using the app store. apple is under a lot of anti-monopoly pressure here and in europe over the app store. keep in mi

he was hired after the enron financial disaster and ray says this is worse than enron.blem, he told congress, ftx and sam bankman-fried did not keep very careful records or really much records at all. here is john ray. >> literally there's no record keeping whatsoever. it's the absence of record keeping. employees would communicate invoices and expenses on slack, essentially a way of communicating for chatrooms. they used quickbooks, multibillion dollar company using quickbooks. >> quickbooks? >> quickbooks. nothing against it. a very nice tool, just not for a multibillion dollar company. >>> twitter isn't paying its bills according to a number of reports including rent on its offices. elon musk reportedly thinking about not paying off laid off workers their severance as required by law and by the agreement they made with twitter. twitter, meantime, selling office chairs, other equipment to raise money. the auction is this weekend. if you do something for twitter, construction services, you may want to get paid ahead of time. >>> and marcus and laura, this is big news,

he was asked by the lawmakers how did this compare and why was this worse than enron? here, let's take a listen. >> the ftx group is unusual in the sense that, you know, i've done probably a dozen large, you know, scale bankruptcies over my career including enron, of course, every one of those entities had some financial problem or another. they had some characteristics in common. this one is unusual and it's unusual in the sense that literally, you know, there's no recordkeeping whatsoever. >> reporter: and so among this lack of recordkeeping they said there were unreliable financial statements and said this company, even though it was managing and holding billions of dollars was operating using accountable soft weir quickbooks which is something that, you know, a small business or, you know, if you're an individual you might even use so just showing how the lack of sophistication and controls is the point he was making in his testimony today. now back in the bahamas, bankman-fried is appearing in court. now, a u.s. official told me he will not waive extradition so th

and that was ken lay's enron. s and enron had the world'sworld' second largest gas pipeline outside of gazprom. s and they just bought the world's largest windmill company. i'm using them as an example becaus e they were among the chief bootleggers. and so enron set about to workoo with their friends. ken lay was very good at this to add value by by through wealth transfers, from making the public buy their stuff or guarantee either coercing youu o to buy it, mandating you buy i it, kneecapping the opposition.h and that continues.at's and it has produced this this many, many billions of dollars every year. renewable energy billion industt you'll see an awful lot of firms are in on in fact, a lot of them make quite clearly when there's a stimulus bill ,money unless you give us this moneyer will go out of business. and the answer obviously is then go out of business. if you require subsidies to exist, you shouldn't get them. and if you don't requireexis subsidies to exist, you shouldn't get them. but this has spawne

with that situation who said, this is way worse than enron? he's in the company now. he's looking at the books, undoing the unwinding of which i speak. >> carley: there is a political element of this too where ftx did give money to republicans but primarily democrat donors and that's because he was trying to... get money to the right people for some sort of crypto friendly regulation, deregulation of crypto. it is really complicated them what's happening. what this boils down to is sam bankman-fried had two companies. one is ftx, the other is alameda research. he used funds, there was no money there. is that correct? >> todd: that's a pretty accurate and hopefully, fingers crossed, a lot of these victims can get their money back. the question is how much of it do they get back, the bigger question is why was he treated different than any other person his position would have been? given carte blanche to do his media tours, you and i and you out there -- >> carley: let me say one more thing because i thought this quote was very interesting, no s

let's go back to enron. that trial was from january 30th 2006 until may 25th 2006.a pretty lengthy trial. i imagine that the federal prosecutors presented ample evidence, of a lot of witnesses. would it have been helpful to have the defendant testify before congress for like six hours, answerable buster questions under oath, prior to that trial, with that have been helpful to federal prosecutors? >> by that time, the company had been confirmed out of bankruptcy. >> before he was arrested, would it have been helpful for him to come before congress and testify for hours on an answer every question we could come up with? >> absolutely. >> so it would've been helpful? >> oh yes. >> okay. so, why 36 hours before he was scheduled to testify before this committee for hours on end, did the southern district of new york set a provisional arrest warrant to the bohemian government to facilitate his arrest, to preclude his testimony, which would've been incredibly helpful in the prosecution of sam bankman-fried? >> i obviously can't speak for the agency. >> it's kind of bizarre

the former restructuring king of enron, he's like this is worse than enron but it's just basic fraud, failure f crypto. maria: it's good to see you. thank you so much for your work. we will talk soon. thank you, sir, merry christmas. >> thank you, merry christmas. maria: we are previewing the november pce index coming out in an hour's time. the word on wall street is right after this. ♪ maria: next week on "mornings with maria," tuesday, get in on the action early, sam dibanchi on 2023's hottest real estate markets. wednesday, jeff van drew takes us inside the vote for the next speaker of the house, thursday, vladimir putin vows no limits to spending on his flailing wall effort. george bebee is here. and friday, congressman carlos jiminez join us. it's right here on "mornings with maria." what should the future deliver? (music) progress... (music) ...innovation... (music) ...discovery? or simply stability... ...security... ...protection? you shouldn't have to choose. (music) gold. your strategic advantage. (music) visit goldhub.com. ♪ ♪ mercedes-benz is turning electric... completely

remember enron field and the super bowl ads and now there's this giant david class action lawsuit goingm brady and larry david for the super bowl -- you know, those sponsorships and all the people who took money from this guy, they better watch out. maria: i'm more outraged of what andy wrote about and the democrats were able to stop him from going under oath. once again doj following what the democrats want, arresting him before he had a chance to spill the beans on all the money he donated. people want that money back. it was investor money. andy, before you go, real quick on the bipartisan bill trying to ban tiktok in the u.s., concerns are growing in washington over app's ties to the chinese communist party and ban transaction under influence of china and russia. your reaction, do you think this goes forward? again, the democrats know the threat that is the communist party of china and yet what have they done about it? >> yeah, so i'm a pretty simple guy on this, you know, china is an antiamerican authoritarian communist regime and if you're doing business with a chinese entity, you

they figured if enron went down and world come this simple fraud, what's next?yed wealth and value and we don't have that situation today so it's much different in that regard. tom: let me cut to the chase -- b the what next is calledinance. how should the politicians you advised years ago, what should they do on then dish on the what's next? >> congress created the regulators over us -- over this. my view is that congress is the top of the food chain. congress doesn't know much about crypto or binance. but congress thinks this stuff is a scam and even people who think there was promise think the actors are a scam and are running away from this as quickly as they can. would gary gensler and others were saying yesterday simply was no matter who you are in this space, we are coming after you. whatever's going on at binance, gensler will use the maximum amount of his power to bring them to heal as quickly as possible. lisa: police are resilience in the shares of crypto companies. this goes against what you are saying where you said this does not look like a bad mom

learned their business plan was designed around something they have socially cooked up and that was enronecond-largest gas pipeline outside of gas promenade bought the world's largest wind mill company. i'm using them as an example because they were among the chief bootleggers. enron set out to work with their friends and set up value by making the public by their stuff or coercing you to buy it, mandating you, knee capping the opposition and that continues and that's produce this many, many billions of dollars every year renewable energy industry voc an awful lot of firms are in on. in fact a lot of them make quite clearly when there is a stimulus bill unless you give us this money will go out of business and the answer obv obviously iso out of business. if you require subsidies to exist, he shouldn't get them. this has spawned a massive industry. government is a big part of that industry, sadly. >> tulsi: chris, i think on this issue, like in so many others that we talked about. all people really want is the truth. tell us what's really going on and let us make decisions accordingly abo

today, the new ceo who worked on the enron bankruptcy pledging accountability of the multi-billion dollar company that he says at one point used quickbooks to manage its accounts. i've just never seen an utter lack of a record keeping. absolutely no internal controls whatsoever. >> california's gig worker law is being debated in the san francisco appeals court apps. take the business model of uber, lyft and other app-based companies. the voter approved prop. 22 allows rideshare and delivery companies to classify workers as independent contractors rather than employees. the measure was approved by nearly 60% of voters in 2020. but later, a judge deemed a deemed the ballot to be a unconstitutional and unenforceable gig. workers rallied today outside the courthouse in san francisco where all of this was being discussed. coming up, addressing san francisco's drug overdose problem. city leaders are calling on mayor london breed support for opening what they call safe come sumption but first, marriage was not protected by law. the historic move today from president biden, how bay from president

that new ceo, your viewers will remember, he used to entangle enron, he said ftx was worse than enronated individuals and he's going to have a laundry list of what he's found that's wrong including accounts with hundreds of millions of dollars worth of crypto in them that were not properly secured and 500 financial transactions by ftx that were not properly accounted for. >> the after shocks of sbf's arrest will be felt all day, and we'll be staying on top of that. mike, it's the u.s./african union summit kicking off today. president biden will be spending two days there, tomorrow and thursday addressing world leaders, and "axios" has got some reporting about how the president is planning a multi country trip to the continent next year. what african nations might he visit? >> this could be a center piece of that appearance by president biden at the u.s./africa summit which will include a dinner in the east room for 49 african leaders. "axios" hans nichols got their hands on reporting saying the u.s. plans a trip in 2023 to africa. why is matters is they want to say to african leaders

when ray comes out and says this is worse than enron when it comes to accounting, and enron was prettyviously, weren't you privy to that? didn't you see anything that would tip you off? >> no, i didn't see anything that would tip me off. you're right, i'd never put an lp into this because i was a paid spokesperson. that would be a conflict of interest i look like an idiot and so do the other 90 investors we all feel very foolish at this point now, the most important thing are the records. john ray has to go get the records. i'd argue this is a very simple situation, not that complicated. you follow the money let me tell you why it's going to be not so hard to do that, every wire transfer going into alameda, whether a fed wire, ach transfer or a swift wire, we're going to know the address it went to, we can audit that all the meat grinding that went on in alameda, we'll get the accounting records and know how that occurred. any transfers between ftx and alameda, we'll get that, too any crypto leaving any of those entities is on the blockchain, irrevocable. you can audit that my guess is

wright, in charge of ftx, the same gentleman that unwound enron, took him 14 years to unwind enron andet money back to people. he said this is the messiest thing he has ever seen never seen a lack of controls in his lifetime. when you look at all the people around the world lost money, all the americans that put money into ftx, that is what happened, the likelihood they will ever see something out of this kid, he says he has got about maybe $100,000 left. >> i think that is the sad reality that the criminal process cannot generally provide restitution to all these people. there are other consequences. maybe he will behind bars but in terms of the practical reality of returning people this money i don't know that is ever going to happen fully not at least through the processes we have at the moment. certainly it's a big disaster. i don't think he is doing himself any favor with this media tour that he is doing. perhaps he thinks it is some sort of trick he is playing on the doj, but that will not get him far in that realm. cheryl: in your legal opinion what is the mistake he mid with th

ray, you have compared ftx as worse than enron.an you please elaborate on some of the specific ways ftx is worse than one of the largest corporate frauds in history? mr. ray: the ftx group is unusual in the sense that i've done probably a dozen large- scale bankruptcies over my career including enron. every one of those entities gets some financial problem or another. they have some common. it is the absence of record-keeping. employees would communicate invoicing and expenses on slack, which is essentially a way of communicating for chat rooms. they use quickbooks. the multibillion-dollar company using quickbooks. rep. wagner: quickbooks? mr. ray: nothing against quickbooks, very nice tool, just not for a multibillion dollar company. we had one person really patrolling us. it is made all the more complex because we are not dealing with widgets or something that is tangible. we are dealing with the technological issues that are made worse when you're dealing with an asset such as crypto. rep. wagner: mr. bankman-fried has apologize

>> 10% pre, that seems too good to be true seems like enron situation whatever is going on inside the next tweet, i notice when the dollar index drops, companies like boeing does well. can you please share your thoughts mike >> it is interesting that you have identified that to be true. i would look out to february you can buy 30 delta calls there to make this play and i think that's a way to do it with limited risk. >> time for the final call carter, you're up first. >> if you are defensive, hold. if you are defensive, tesla for balance. >> brian >> gld call spread play to the up side. >> mike khouw. >> vale, same thesis. >> happy holidays. that does it for "options action." great to be with you back next friday at 5:30 p.m. eastern. "mad money" with jim cramer starts right now. >>> my mission is simple, to make you money i'm here to level the playing field for all investors. there's always a bull market somewhere and i promise to help you find it. the "mad money" starts now hey, i'm cramer. will come to cramerica my job is not just to education

more complicated and legal experts, you talk about analogies or a madoff or theranos situation or enron, that those are complicated, but they don't have the cross border aspect. they don't have the cryptocurrency aspect, so that muddies the water a little bit in terms of unwinding all this, the fact it's not only in the bahamas, it's antigua, and 130 or so affiliated entities, all over the world, europe, africa, you name it, this company had tentacles in every jurisdiction you can think of >> what did you make of his strategy to use this media apology tour to garner public support or forgiveness, and what do you think is likely to happen from here if we are no longer perhaps going to hear from him the way we have or maybe we will >> well, first of all, what i thought of it was, it's kind of the, you know, the emperor has no clothes it was a fictional attempt at some form of contriction, but as we know, these cases are built not only on the ridiculous statements of the individuals who were the targets but also upon evidence of the actual criminal acts. and as mr. wray outlined this morni

you know it's bad when even the guy who had to clean up the enron scandal is horrified [ light laughtery this could get any worse is if we found out that, i don't know, one of the key proponents of the iraq war was somehow connected to -- oh [ bleep ]. [ laughter ] also, once again, why did it take until now for someone to figure out that this dude was grossly inexperienced and unsophisticated? look, i know i'm hosting a network television show dressed like i'm about to go cut down the rockefeller christmas tree, but -- [ laughter ] wasn't it nice when con artists put a little more thought into their outfits? i mean, in "music man" harold hill had a straw hat and a nice bow tie, so when he ripped you off, you didn't have to feel bad about getting tricked. but now it's all i dress like a record producer or i dress like steve jobs, or i dress like the kid at the skate park who has the most expensive board but just stands against the fence not doing any tricks anyway, part of the reason sbf's companies were scams is that a significant portion of the balance sheet was reportedly held in a n

ray, you have compared ftx as worse than enron.aborate on some of the specific ways ftx is worse than one of the largest corporate frauds in history? >> the ftx group is unusual in the sense that, you know, i have done probably a dozen large, you know, scale bankruptcies over my career including enron, of course every one of those entities had some financial problem or another. they have some characteristics that are in common this one is unusual and it is unusual in the sense that literally, you know, there's no record keeping whatsoever. the absence of record keeping. employees would communicate, you know, invoicing and expenses on slack which is, you know, essentially a way of communicating for chat rooms they used quick books. a multi-billion dollar company using quick books. >> quick books >> quick books nothing against quick books. it is a very nice tool, just not for a multi-billion dollar company. there's no independent board, all right. we had one person really controlling this, no independent board. that's highly unusual

bernie madoff, for what happened with enron. .ctually been calling for clear regulation and trying to work with policymakers. we made progress on that across various g20 countries. i think it will serve as a wake-up call and as a catalyst to where we will get more clear regulation in the united states. that will be a good thing for both coinbase and the whole industry. >> sam bankman-fried was supposedly interested in having the c.f.t.c., which regulates commodities, as a regular for the industry, rather than the ftc, which tends to regulate securities. do you have a view of what is better for the industry, and what you would prefer as regulator? >> crypto is many different things. there are several crypto commodities that should be regulated at the c.f.t.c.. in the future they may even want to regulate spot trading of commodities. the sec should be regulating crypto securities. i think that could be a very big business in terms of how people raise capital for their businesses and investments and things like that in the united sta

. >> reporter: ftx's new ceo, john ray, led energy giant enron through bankruptcy after its collapse today appearing before congress, he ripped into bankman-fried's management. >> this is just taking money from customers and using it for your own purpose, not sophisticated at all this is just plain old embezzlement. >> reporter: at its peak, ftx had 2.7 million users in the u.s., and superstar celebrities were promoting the company. >> you know what i'm in >> reporter: bankman-fried was also donating tens of millions of dollars to political campaigns, including president biden's 2020 white house bid, but today's allegations say that money actually belonged to customers. the white house saying due to the hatch act, it could not answer questions of whether or not the president would return the donations. >> and all of this dirty money was used in service of bankman-fried's desire to buy bipartisan influence and impact the direction of public policy in washington >> reporter: in a statement today, his lawyers said mr. bankman-fried is reviewing the charges with his legal team and consid

. >> this is exactly what happened with enron in the is what happens in 2008. amanda: development comes one month after bankman-fried five -- filed for bankruptcy and weeks after he discussed with abc about the fall of ftx. >> i was not spending time or effort trying to manage risk on ftx. >> that is a pretty stunning admission. amanda: back in the bay area, the tech expert referenced elizabeth holmes, recently sentenced to 11 years in prison for defrauding investors of the blood shedding testing company theranos both have silicon valley ties. and were once considered shining examples of it innovation and entrepreneurship. >> without being honest up front, this is what we will see. it is not fake it until you make it. amanda: in silicon valley, amanda del castillo oh, abc 7 news. dan: happening now, brace yourself for another cold night and frigid morning as we look live from our east. bay hills camera. the temperature keeps dropping. sandhya patel is here. it could be dangerous in terms of how low it goes for some people. sandhya: we will talk about subfreezin

>> 10% pre, that seems too good to be true seems like enron situation whatever is going on inside thenext tweet, i notice when the dollar index drops, companies like boeing do well. will you please share your thoughts what's your take, mike >> it is interesting that pattern that you identified turned out to be true. i would look out to february you can buy 30 delta calls there to make this play and i think that's a way to do it with limited risk. >> time for the final call carter, you're up first. >> if you are defensive, hold. if you're feeling aggressive, tesla for balance. >> brian >> gld call spread play to the up side. >> mike khouw. >> vale, call spread, same thesis >> happy holidays, for everybody out there. that does it for "options action." great to be with you back next friday at 5:30 p.m. eastern. "mad money" with jim cramer starts right now - [voiceover] the following program is a paid advertisement for nuwave oxypure smart air purifier, sponsored by nuwave llc. presenting nuwave's latest innovation, the oxypure smart air purifier. the environmental protection agency warns

. >> 10% premiums is too good to be true and stay far away from that and seems like an enron situation on. >> our next one, i notice when the dollar index drops companies like boeing does well. can you please share your thoughts, mike >> it is interesting that pattern you've identified has proven to be true. i would look out to february cow buy some perhaps 30 delta calls there to make this play and i think that's a way to do it with limited risk >> all right, time now for the final call carter, you're up first. >> if you're defensive, bold, if you're feeling aggressive, tesla for a bounce >> brian >> yeah, gld call spread to the up side. >> vale, same thesis >> we're back next friday at 5:30 p.m. next friday. "mad money" with jim cramer starts right now is a paid programllowing for joint food with tamasteen, brought to you by nordic healthy living, a proud sponsor of the arthritis national research foundation. these statements have not been evaluated by the food and drug administration. this product is not intended to diagnose, treat, cure, or prevent any disease. (gentle bright music

i've been listening to analogies to enron.ven analogies to the mortgage meltdown, mortgage-backed security. those cases are backed by real assets in the cases of enron you've got the energy producing company. in the cases of mortgage-backed securities it was an outrageous scandal. at the end there was supposed to be backed by, what is this backed by if i could ask you? >> it's a story the economist talks about how economic narratives form. in response to real events in this case crypto currency i would argue was the subprime crisis. the white paper released in october of 2008 was perhaps well-intentioned. it was intended to be a peer currency that would avoid all intermediate areas. so the story has understandable appeal. if it serves any function it's to highlight the myriad of failures of the regulated system and of the economic system to provide people with a fair shot at the american dream or what's left of it. that doesn't make the story true, however, the story of crypto currency. what it does is lend enormous power and

important is that he has overseen some of the biggest bankruptcies in american history, including tt of enrond as he's unraveled a lot of these, he has said that it has been relatively easy comparatively to unravel some of those previous bankruptcies because there's some sort of paper trail. in the case of ftx, there was just no management control, no clear paper trail as to what exactly has happened. so it's going to te quite a while for this all to come out. laura: let's just talk about the scale of what bankman-fried is accused of, prosecutors here in new york city say that he knowingly this routed the customers of the cryptocurrency exchange, it's pretty staggering, isn't it? >> what prosecutors even said is that basically he use the ftx as his own personal line of credit with absolutely no limits that he would take money from investors that put money into ftx and use it into his hedge fund, and even went so far as going on shopping sprees and using the money for his own personal use. if you look at the indictment there were eight counts spanning 13 pages and among those charges include w

>> this guy experience and worked on enron getting money back for people.they will get a lot back but if someone will get money back for them and tried to claw it back from wherever it went because a lot of it has gone missing. this guy is charged with doing it and then winding it down. it will not exist in the end, probably. not at all. i think he will be looking for money anywhere it went and sam bankman-fried was like it was in the drawer and i do not know where it went after i put it in the drawer. ross: i am sure there are some people watching and say let us stand back from the individuals involved a thinking how it is possible that an operation with as much money flowing through it can be so under regulated? >> it was starting to be regulated. it is a new industry so it is perfect for this kind of fraud. i think a lot of people bought into it and there was a lot of hype around crypto and people are seeing a lot of billionaires and miionaires get made and it is a perfect time for people to mid fraud. the minute it fell apart it was clear it was fraud.

." >> enron was really a different company.t was -- crimes that were committed there were highly orchestrated financial machinations by highly sophisticated people to keep transactions off balance sheets. this is really old-fashioned embezzlement this is just taking money from customers and using it for your own purpose. not sophisticated at all sophisticated is perhaps in the way they were able to sort of hide it from people. frankly, right in front of their eyes >> meantime, bankman-fried denied bail as a flight risk and remanded to jail until february. >> they're approaching this, we have to admit, with some real seriousness. that gentleman was just fantastic. i thought he was great, because when you say that it's just embezzlement, it's right in front. what that says is, look out. there could be others that are like that. >> yeah. i agree with you listening to mr. ray yesterday was surprising, actually, how compelling it was, and i think i'm not alone in thinking these well-known venture capital firms or firms that made inv

. >> this is exactly what happened with enron in the is what happens in 2008. amanda: development comes one month after bankman-fried five -- filed for bankruptcy and weeks after he discussed with abc about the fall of ftx. >> i was not spending time or effort trying to manage risk on ftx. >> that is a pretty stunning admission. amanda: back in the bay area, the tech expert referenced elizabeth holmes, recently sentenced to 11 years in prison for defrauding investors of the blood shedding testing company theranos both have silicon valley ties. and were once considered shining examples of it innovation and entrepreneurship. >> without being honest up front, this is what we will see. it is not fake it until you make it. amanda: in silicon valley, amanda del castillo oh, abc 7 news. dan:, brace yourself for another cold night and frigid morning as we look live from our east. bay hills camera. the temperature keeps dropping. sandhya patel is here. it could be dangerous in terms of how low it goes for some people. sandhya: we will talk about subfreezing conditions f

the collapse of ftx has been called one of the worst business failures since enron bankman-fried is facing fraud and conspiracy charges accused of stealing billions of dollars in customer money for his own purchases. he is expected to be extradited back to the united states, but not without a fight. bankman-fried has denied any wrongdoing. >> megan thee stallion testified against fellow rapper tory lanes and a los angeles courtroom today. she accuses the canadian rapper of shooting at her feet after a fight in july of 2020, injuring one of her feet. the 30 year-old is charged with negligent discharge of a firearm as well as assault with a semiautomatic firearm and having an unregistered weapon. the accusations have created to hostility in the hip-hop world with many artists taking sides lanes has denied the charges. megan's fans and supporters were outside the courthouse today rallying holding signs like this one that said, we stand with megan. they say they also wanted to show support for victims of domestic violence. >> coming up in sports as 2 days after the victory over the buccaneers.

that the situation at f t x is worse than what he found at enron. 2 decades ago. he painted a picture of a company acting with no oversight and leaving behind no paper trail. now before his arrest on monday banquet free did plan to testify under oath before that same committee to day, according to elite draft of his testimony. he intended to open by admitting that he had, quote, screwed up, or at least using words that we can't say to that effect here on tv. the crypto king might not have been there, but the leak of his plan testimony and his choice of words. it did not go down well in washington. take a listen. i don't know him personally and probably the want to, but i it's just among us so disrespectful. i mean, there's not a person that you would like to show this. so there are children. he says, and i quote, i would like to start out by formally stating under oath and i, yeah, i can use it publicly. lakes to words, absolutely insulting. well, oh our next guest is a prominent critic of the crypto currency industry. i want to welcome to the show molly white sma

you versus this could be the biggest, should get a crime ever investigated bigger than enron, bigger than our own. bernie made off bigger than anything you can imagine. this is, this knows both. well, and we're just getting to the, to the surface level of this. you also have somebody and i can say this enough and it means a lot here in this country. he has no jury appeal. he is weird. he has come to us as this woke, left dis, demented. he's into affective altruism. i'm sure you've heard this. he's not doing it for the profit he wants to give everything away. and what's happening is that for the 1st time in a long time, citizens are looking to find out women who is this person and who are these people, and what is this crypto and where's the government? and when you hear, because if you hear his interview, he said that was an oversight. i don't know how do you much, but at the x account basically to to, to fund your lavish lifestyle and then claim some accounting oversight. i mean the man, there's not enough room, he's hanging up. so this is gonna be the biggest thing you've ever seen