TechFlow reported, according to Bloomberg, that FTX's former general counsel Can Sun testified in court that in an email several months before FTX's collapse, the company falsely promised institutional clients—including hedge fund Sculptor Capital Management—that their assets would remain safe even if the company went bankrupt. Sun stated he "never approved" FTX’s lending customer funds to its affiliated firm Alameda Research and claimed he was unaware that customer funds were being misused. He believed customers’ funds were fully protected and segregated from corporate funds. Sun asserted he did nothing wrong and has since entered into a non-prosecution agreement with the government.
Sun also said that Apollo Global Management, a major asset manager, pulled out of a rescue plan for FTX at the last minute after learning billions of dollars in customer funds were missing and FTX could not provide legal justification for the shortfall. FTX collapsed just days later. Sun confirmed he and another FTX executive spoke with Apollo in November 2022, during which Apollo requested FTX’s financial statements before making a decision. Sun later saw a spreadsheet provided to Apollo, which revealed a multibillion-dollar gap in customer funds—indicating the exchange could not meet withdrawal demands.
In addition, Third Point director Robert Boroujerdi testified today at SBF’s trial, stating his firm invested $60 million in FTX, a position that has since been written down to zero.
