Just nine months prior to the collapse of the exchange, court records reveal that FTX's Bahamian subsidiary spent a stunning sum of money on luxury hotels, lodging, travel, and meals.
FTX Digital Markets spent $40 million between January and September 2022, according to bankruptcy court documents analyzed by Business Insider. This was only two months before the company filed for bankruptcy, alleging liquidity concerns.
More than $15 million was spent on upscale accommodation, $5.8 million of which was spent at the Albany Hotel. Sam Bankman-Fried resided in his $30 million penthouse at this opulent resort up until his arrest, the report said.
A stay at the Grand Hyatt, a four-star hotel that entertained British royalty in March 2022, cost about $3.6 million. Additionally, the five-star Rosewood resort received an expenditure of $800,000.
Additionally, the documents show that almost $7 million was spent on meals and entertainment, with catering services accounting for around half of that total. Over $500,000 was spent on shipping and delivery, while nearly $4 million was spent on flights.
According to the Financial Times, FTX even negotiated a private agreement with an airline to fly their Amazon orders from a Miami depot because the e-commerce giant didn't deliver to the Bahamas.
The firm reportedly gave Bahamas employees a "full suite of cars and gas covered for all employees [and] unlimited, full expense covered trips to any office globally," according to the FT.
A former employee revealed the scale of the company's extravagant luxury spending in December 2022, calling it "cult-like." "The entire operation was iconically and moronically inefficient," she remarked at the time.
FTX also contributed significantly to local charities and organizations in the Bahamas.
According to a Jan. 8 story in local media, some of these donations may have to be returned as the Caribbean island nation attempts to move forward.
Bankman-Fried pleaded not guilty to eight felony charges in the United States. On Jan. 3, the Southern District of New York District Court heard the case.
The former FTX CEO had been placed under house arrest at his parents' home in California since Dec. 22, but he returned to New York for the plea hearing. Bankman-bail Fried's was also conditional on him not accessing or transferring any bitcoin or assets from FTX or Alameda, most likely in reaction to reports that he had moved monies from Alameda wallets while at home, according to Judge Lewis Kaplan.
Gary Wang, co-founder of FTX, and Caroline Ellison, former CEO of Alameda, have already pled guilty to related offenses.