Bankman-Fried ‘unwilling’ to accept subpoena, escalating Senate standoff

Senate lawmakers blasted former FTX CEO Sam Bankman-Fried for declining to appear at a hearing this week, calling his decision an “unprecedented abdication of accountability.”

The Senate Banking Committee will investigate the collapse of crypto exchange FTX at a hearing on Wednesday. Bankman-Fried, who will testify at another congressional hearing Tuesday, has declined an invitation to testify before the key Senate panel. 

“Virtually every CEO, financial regulator, and administration official for Republicans and Democrats has agreed to testify in front of both the Senate and House when called upon – that is how congressional oversight works,” Committee Chair Sherrod Brown, D-Ohio, and ranking Republican Sen. Pat Toomey, R-Pa., said in a statement. “He has declined in an unprecedented abdication of accountability.”

The lawmakers added that Bankman-Fried’s lawyers have indicated he would duck the subpoena, escalating the standoff to potentially add contempt of Congress charges to the embattled crypto mogul’s other legal troubles. But the process could prove lengthy, meaning that the senators are continuing to negotiate with Bankman-Fried’s lawyers in order to secure his testimony. They noted that they’ve offered two dates to appear before their committee. 

“Given that Bankman-Fried’s counsel has stated they are unwilling to accept service of a subpoena, we will continue to work to have him appear before the Committee,” Brown and Toomey said. “He owes the American people an explanation.”

Actor and prominent crypto skeptic Ben McKenzie Schenkkan, law professor Hilary Allen, television personality and paid FTX spokesperson Kevin O’Leary, and Cato Institute expert Jennifer Schulp are currently scheduled to testify at the hearing.  

House hearing

Bankman-Fried, who resigned as CEO of FTX when the firm filed for bankruptcy protection last month but maintains more control over the Bahamas-based subsidiary FTX Digital Markets that ran a substantial amount of his crypto trading business, will appear virtually before the House Financial Services Committee on Tuesday for a separate hearing on the FTX collapse. The former FTX and Alameda boss cited his busy schedule and worries about being hounded by paparazzi as reasons why he will not travel to Washington, D.C. for the hearing. 

The former CEO said during a Twitter Spaces interview that he expects the back-to-back House and Senate hearings will be “very materially similar.” Bankman-Fried hinted he could change his mind on cooperating with the Senate committee the same way he did with House Financial Services. 

“I am open and willing to have a conversation with the chair or the ranking member about the hearing if they believe it’s important that I attend,” Bankman-Fried said. 

Disclaimer: Beginning in 2021, Michael McCaffrey, the former CEO and majority owner of The Block, took a series of loans from founder and former FTX and Alameda CEO Sam Bankman-Fried. McCaffrey resigned from the company in December 2022 after failing to disclose those transactions.

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