Dori: Is your cryptocurrency part of the new FTX scandal?

Nov 18, 2022, 5:02 PM | Updated: Nov 20, 2022, 6:26 am


CEO of FTX Sam Bankman-Fried testifies during a hearing before the House Financial Services Committee at Rayburn House Office Building on Capitol Hill December 8, 2021 in Washington, D.C.(Photo by Alex Wong/Getty Images)

(Photo by Alex Wong/Getty Images)

Worse than Enron.

That’s what experts are calling the FTX financial scandal still erupting before cryptocurrency investors’ eyes.

Business ethics author, founder of The Integrity Institute and Enron whistleblower Lynn Brewer told Thursday’s Dori Monson Show that the FTX case could have an even deeper reach – especially for the millions of customers who bought Bitcoin and other cryptocurrencies.

Brewer – who said she was an early crypto investor for $4,000 – said she has ridden the “upside and the downside” of the purchase.

In a straight-forward interview, Brewer explained how FTX became a “giant money laundering scheme” that, like Enron, is going to hurt “the little guy who lost their money.”

FTX was started in 2019 by Sam Bankman-Fried to prop up Alameda Research, a company started in 2017. The companies – operating out of The Bahamas – would buy Bitcoin and other cryptocurrencies at a lower price in one part of the world and sell them at higher prices elsewhere, leaving Bankman-Fried’s team to keep the profits.

Dori: Parent upset with appointment of felon as Olympia School Board Member

Even though Bitcoin was a trade used on Wall Street, Alameda had zero regulatory oversight.

FTX and Alameda, Brewer explained, targeted everyday investors who wanted in on trading the popular new cryptocurrencies. High-profile celebrities – including NFL superstar Tom Brady and Larry David, co-creator of TV’s “Seinfeld” and “Curb Your Enthusiasm,” were used to advertise the company.

Company officials told potential investors last year that it was making $1 billion in annual revenue. With its leveraged, or borrowed, money, Bankman-Fried is thought to have purchased millions in offshore real estate. Before the scandal broke, the 30-year-old was believed to be worth $23 billion.

Last week, lawyers – including his Stanford Law School professor and father, Joseph – convinced Bankman-Fried to step down. John Ray III has since been named the new CEO. Ray was also on the team that dealt with the aftermath of the Enron collapse.

Reports show that because FTX and Alameda were so dependent on each other, both companies were shattered when crypto prices started dropping earlier this year. The downfall has created billions of dollars in losses for crypto traders and customers.

More from Dori: Ingraham teacher swears, blames Seattleites who ‘didn’t vote blue’ for school shooting

How were there no red flags? Dori wondered.

“There were red flags,” Brewer responded. She pointed to Bankman-Fried’s own public comments about what he saw as weaknesses in regulations that allowed him to operate.

Meanwhile, Brewer added, with $70 million in contributions, Bankman-Fried’s company was the third largest donor to the Democratic Party. In comparison, the now-bankrupt energy company, Enron, donated $100 million to Republicans.

Listen to Dori Monson weekday afternoons from noon – 3 p.m. on KIRO Newsradio, 97.3 FM. Subscribe to the podcast here.

Dori Monson Show

Dori Monson

Dori Monson stage show...

MyNorthwest Staff

Watch: Dori Monson’s ‘What are the Odds?’ stage show

In 2019, Dori Monson hosted a stage show - 'What are the Odds?' - which introduced you to the people who helped shape his improbable career.

9 months ago

Dori Monson welcomes the Moose back to KIRO. Follow @

MyNorthwest Staff

A collection of the all-time best Dori Monson stories

With the passing of Dori Monson, a collection of some of his top stories to remember all the hard work Dori brought to Seattle.

9 months ago

Alaska, fishing...

KIRO Newsradio staff

Listen: Friends, colleagues offer tribute to KIRO Newsradio’s Dori Monson

All day Monday, KIRO Newsradio's John Curley talked to friends, news makers, and more in tribute to Dori Monson.

9 months ago

Dori Monson Shorecrest...

Dori Monson Show

How to support charities reflecting Dori Monson’s values, passions

In tribute to Dori Monson, learn more about how you can support these three charities which best reflect his values, passions, and advocacy.

9 months ago

Dori Monson Nicole Thompson...

MyNorthwest Staff

Broadcasters, politicians, coworkers and friends remember Dori Monson

Dori Monson, a longtime KIRO Newsradio host, passed away Saturday. He is remembered by public figures, broadcasters, coworkers, and listeners.

9 months ago

Dori Monson...

MyNorthwest Staff

Longtime KIRO Newsradio host Dori Monson dies at age 61

We are deeply saddened to announce Dori Monson's sudden passing on Saturday, December 31, 2022, at a Seattle hospital.

9 months ago

Sponsored Articles

Swedish Cyberknife...

September is Prostate Cancer Awareness Month

September is a busy month on the sports calendar and also holds a very special designation: Prostate Cancer Awareness Month.

Ziply Fiber...

Dan Miller

The truth about Gigs, Gs and other internet marketing jargon

If you’re confused by internet technologies and marketing jargon, you’re not alone. Here's how you can make an informed decision.

Education families...

Education that meets the needs of students, families

Washington Virtual Academies (WAVA) is a program of Omak School District that is a full-time online public school for students in grades K-12.

Emergency preparedness...

Emergency planning for the worst-case scenario

What would you do if you woke up in the middle of the night and heard an intruder in your kitchen? West Coast Armory North can help.

Innovative Education...

The Power of an Innovative Education

Parents and students in Washington state have the power to reimagine the K-12 educational experience through Insight School of Washington.

Medicare fraud...

If you’re on Medicare, you can help stop fraud!

Fraud costs Medicare an estimated $60 billion each year and ultimately raises the cost of health care for everyone.

Dori: Is your cryptocurrency part of the new FTX scandal?