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☆ Former FTX CEO Sam Bankman-Fried refuses to testify before Senate, committee says
▼ + stars: | 2022-12-12 | by ( Brian Schwartz | ) www.cnbc.com time to read: +1 min

Sam Bankman-Fried, founder and chief executive officer of FTX Cryptocurrency Derivatives Exchange, speaks during a Senate Agriculture, Nutrition and Forestry Committee hearing in Washington, D.C., on Wednesday, Feb. 9, 2022. Former FTX CEO Sam Bankman-Fried is refusing to testify at a hearing this week about his company's implosion, the Senate Banking Committee said Monday. Attorneys for the crypto platform's founder have also said Bankman-Fried, who is based in the Bahamas, will not accept service of a subpoena to compel his testimony before the panel, senators said. Bankman-Fried is scheduled to appear at a House Financial Services Committee hearing on Tuesday that will focus on his company's collapse. In a joint statement, Senate Banking Chair Sen. Sherrod Brown, D-Ohio and ranking member Pat Toomey, R-Pa., said they have "offered Sam Bankman-Fried two different dates for providing testimony before the Senate Banking, Housing, and Urban Affairs Committee, and are willing to accommodate virtual testimony."

☆ Alameda ex-CEO Caroline Ellison taps SEC's former top crypto regulator as lawyer in FTX investigation
▼ + stars: | 2022-12-10 | by ( Bethany Biron | ) www.businessinsider.com time to read: +3 min

Caroline Ellison hired Stephanie Avakian and law firm WilmerHale to represent her in the FTX investigation, per Bloomberg. Sources close to the matter told Bloomberg that Avakian, as well as fellow WilmerHale lawyers, will represent Ellison. Avakian and WilmerHale will represent Ellison during the federal probe into her former company, Alameda Research, the trading firm and corporate sibling of fallen cryptocurrency exchange, FTX. Ellison has remained an elusive figure in the collapse of FTX, staying mum and largely unreachable during its downfall. As noted by Bloomberg, while Bankman-Fried has publicly placed blame on Alameda in numerous interviews, Ellison has stayed silent.

Come next year, Democrats will have unilateral subpoena power in many committees to compel investigative targets to provide documents and testimony — without needing GOP support. “Our committees will have greater oversight ability, subpoena power. Subpoena power can deal with corporate corruption and inequities, and other problems throughout the country,” he said. “And if using subpoena power becomes necessary, then that’s something we can do.”Other Democrats floated industries that could be the targets of the party's subpoena powers. “But having subpoena power for CEOs and billionaires who think they don’t have to come to Congress to explain themselves will be very valuable.”

New York CNN —Sam Bankman-Fried, the founder of the failed crypto exchange FTX, has agreed to testify before the Senate Banking Committee next week as questions and confusion swirl about the collapse of his companies. One of the key questions prosecutors are likely to probe is whether FTX misappropriated customer funds when it made loans to Alameda. “I didn’t knowingly commingle funds,” he told The New York Times last week. The Times said the issue is part of a broadening inquiry into the collapse of FTX, and it’s not clear whether prosecutors have determined any wrongdoing by Bankman-Fried. In a statement to the paper, Bankman-Fried said he was “not aware of any market manipulation and certainly never intended to engage in market manipulation.”

☆ Premarket: Oil stocks are pointing to higher gas prices to come
▼ + stars: | 2022-12-09 | by ( Nicole Goodkind | ) edition.cnn.com time to read: +6 min

New York CNN —Brutally high oil and gas prices were the talk of the town in 2022 and one of the largest contributing factors to sky-high inflation. Oil prices and energy stocks are closely interlinked — so this discrepancy is an odd one and could mean that lower gas prices may not be here to stay. What’s happening: The price of West Texas Intermediate crude oil, the US benchmark, which is a large driver of gas prices, has fallen to its lowest level of the year this week — under $72 a barrel. But even though gas prices are falling, they’re still higher than they have been over the past few years. Exxon and Chevron are also speculating that crude prices will remain elevated and that demand will grow.

☆ U.S. lawmakers urge Biden to guarantee rail workers' sick leave
▼ + stars: | 2022-12-09 | by ( David Shepardson | ) www.reuters.com time to read: +3 min

WASHINGTON, Dec 9 (Reuters) - More than 70 lawmakers including Senator Bernie Sanders and Representative Alexandria Ocasio-Cortez on Friday urged President Joe Biden to take executive action to guarantee rail workers paid sick days. On Dec. 2, Biden signed legislation to block a national U.S. railroad strike that could have devastated the American economy after some unions voted against the deal over a lack of paid sick leave. The White House did not immediately comment on the lawmakers' letter, signed by 72 Democratic lawmakers and Sanders, an independent who caucuses with Democrats. Railroad workers have no paid short-term sick days after unions representing 115,000 workers asked for 15 days and railroads settled on one personal day. "Guaranteeing that workers are not operating trains or inspecting rail signals while sick or tired would fundamentally improve the safety of our national rail operations," the letter said.

☆ Senators Warren, Smith ask Fed for accounting of banks' crypto ties
▼ + stars: | 2022-12-08 | by ( ) www.reuters.com time to read: +1 min

Senators Elizabeth Warren and Tina Smith are demanding an accounting from the Federal Reserve and other U.S. financial regulators of banks' cryptocurrency activity and ties to the industry following the implosion of crypto exchange FTX. "We write to express concern ... and to inquire about how your agency assesses the risks to banks and the banking system associated with those relationships," wrote the senators, both Democrats on the Senate Banking Committee. The letters asked for details on oversight of banks' cryptocurrency trading and loans to crypto firms, and asked if regulators plan to conduct a review of crypto firms' relationships with banks. They gave regulators two weeks to respond to their requests. Reporting by Ann Saphir; editing by Jonathan OatisOur Standards: The Thomson Reuters Trust Principles.

☆ Sam Bankman-Fried: US lawmakers want answers from FTX founder
▼ + stars: | 2022-12-08 | by ( Allison Morrow | ) edition.cnn.com time to read: +4 min

New York CNN —Lawmakers are demanding that Sam Bankman-Fried, the founder of the failed crypto exchange FTX, appear before the Senate Banking Committee next week over “significant unanswered questions ” surrounding the collapse of his companies. FTX was one of the biggest crypto exchanges in the world until last month, when it faced a sudden wave of customer withdrawals that it couldn’t cover. One of the key questions prosecutors are likely to probe is whether FTX misappropriated customer funds when it made loans to Alameda. The Times said the issue is part of a broadening inquiry into the collapse of FTX, and it’s not clear whether prosecutors have determined any wrongdoing by Bankman-Fried. In a statement to the paper, Bankman-Fried said he was “not aware of any market manipulation and certainly never intended to engage in market manipulation.”

☆ House Financial Services Chair Waters doesn't plan to subpoena Sam Bankman-Fried to testify at hearing on FTX collapse
▼ + stars: | 2022-12-07 | by ( Brian Schwartz | ) www.cnbc.com time to read: +3 min

House Financial Services Committee Chairwoman Maxine Waters told Democrats she doesn't plan to subpoena former FTX CEO Sam Bankman-Fried to testify at Tuesday's hearing about the crypto exchange's rapid demise, according to people with direct knowledge of the conversation. Those at the meeting say Waters said she wants committee staff try to convince Bankman-Fried to voluntarily testify, those with knowledge of the meeting said. As of late Wednesday, Bankman-Fried has yet to agree to voluntarily testify to the House committee, two of the people explained. Waters invited Bankman-Fried to voluntarily testify before the panel and could always change her mind and subpoena him before Tuesday. John Jay Ray III, the new FTX CEO, is scheduled to testify at next week's House hearing.

☆ Sen. Warren demands answers from Silvergate Bank about its business dealings with FTX
▼ + stars: | 2022-12-06 | by ( Gretchen Morgenson | Gretchen Morgenson Is The Senior Financial Reporter For The Nbc News Investigative Unit. A Former Stockbroker | She Won The Pulitzer Prize In For Her | ) www.nbcnews.com time to read: +13 min

“Life as a crypto firm can be divided up into before Silvergate and after Silvergate,” Bankman-Fried gushed in a testimonial featured recently, and prominently, on Silvergate Bank’s website. But in a conversation with an investment manager, a former top FTX employee said Silvergate was FTX’s primary banking partner. As a regulated bank, Silvergate has a duty to monitor clients’ accounts for suspicious activities that could signal fraud, money laundering or tax evasion, the filings note. FTX frequently used the Silvergate Exchange Network, according to the former FTX employee with direct knowledge of the transactions. A Silvergate spokeswoman said the change reflected a shift in functions taken on by a new president at the bank.

☆ Senate Banking Chairman Brown to introduce bill closing 'shadow' banking loophole after Elon Musk says Twitter will process payments
▼ + stars: | 2022-12-06 | by ( Chelsey Cox | ) www.cnbc.com time to read: +3 min

Senate Banking Committee Chairman Sherrod Brown will introduce a bill Tuesday that aims to close the so-called shadow banking loophole that allows retail and tech companies to offer banking services without the same stringent oversight as other financial institutions. Twitter is one of several non-bank companies that sought to enable banking services for users through state-chartered ILCs. Jack Dorsey, Musk's predecessor at Twitter, also was involved in financial services through his separate payments company Square. Other companies that have applied for ILC charters include eCommerce marketplace Rakuten, Ford Motor Company and financial services firm Edward Jones . The Federal Deposit Insurance Corporation approved ILC deposit insurance applications for Square and Nelnet, a student financial services company, in 2020.

☆ Democrats Didn’t Just Win Georgia. They Secured a Firmer Grip on the Senate.
▼ + stars: | 2022-12-06 | by ( Carl Hulse | ) www.nytimes.com time to read: +2 min

Having an edge on the committees will allow Democrats to overcome Republican opposition, if they can hold together. Mr. Manchin, however, has said that he would welcome a wider margin because it would take some of the attention and pressure off him as he weighs another run in 2024. Such a situation would “make it easier for me,” Mr. Manchin told reporters last week on Capitol Hill. Mr. Warnock’s win also secured for Democrats the authority to subpoena witnesses before Senate committees without the cooperation of Republicans, which could be hard to come by if the G.O.P. With House Republicans planning an onslaught of investigations when they assume control in January, the ability of Senate Democrats to mount their own investigations could allow them to counterpunch.

☆ Sen. Pat Toomey: FTX fallout is due to outrageous behavior of an individual
▼ + stars: | 2022-12-02 | by ( ) www.cnbc.com time to read: 1 min

Share Share Article via Facebook Share Article via Twitter Share Article via LinkedIn Share Article via EmailSen. Pat Toomey: FTX fallout is due to outrageous behavior of an individualSen. Pat Toomey (R-, the lead Republican on the Senate Banking Committee, joins CNBC's 'Squawk Box' to discuss why he disagrees with Congress' decision to avert a rail union strike through legislation. Toomey also discusses what's ahead for crypto and regulation following the collapse of FTX.

☆ Washington lawmakers hold on to crypto holdings despite calls for new laws in wake of FTX collapse
▼ + stars: | 2022-12-01 | by ( Brian Schwartz | ) www.cnbc.com time to read: +7 min

Another lawmaker, Republican Sen. Tommy Tuberville of Alabama, disclosed at a Senate Agriculture Committee hearing about FTX on Thursday that he, too, holds some crypto assets. Tuberville's most recent disclosure reports from this year reviewed by CNBC do not show any crypto stock purchases. Out of all ten offices contacted, only one said they sold their crypto stock holdings after FTX imploded. Rep. Marie Newman, D-Ill., who lost her bid for reelection owned crypto stock up until last week, recently sold her digital token stocks as the industry took a hit. Toomey told CNBC "HODL" when asked about whether he plans to sell his crypto stock following FTX's collapse.

☆ Senate banking chief urges U.S. Treasury to secure new crypto rules
▼ + stars: | 2022-11-30 | by ( Hannah Lang | ) www.reuters.com time to read: +1 min

[1/2] A representation of virtual currency Bitcoin and U.S. One Dollar banknotes are seen in front of a stock graph in this illustration taken January 8, 2021. Senator Sherrod Brown of Ohio also urged the Financial Stability Oversight Council (FSOC), a U.S. regulatory panel comprising top financial regulators, to find ways to enhance crypto asset disclosures and bolster market integrity. FTX filed for bankruptcy on Nov. 11 after traders pulled $6 billion from the platform in three days and rival exchange Binance abandoned a rescue deal, sending shock waves across the crypto market. In that report, regulators identified several gaps in the oversight of cryptocurrencies, including in the crypto spot market for tokens that are not securities. Reporting by Hannah Lang in Washington Editing by Matthew LewisOur Standards: The Thomson Reuters Trust Principles.

☆ Sen. Sherrod Brown calls on Treasury Secretary Janet Yellen to help rein in cryptocurrency firms after FTX collapse
▼ + stars: | 2022-11-30 | by ( Chelsey Cox | ) www.cnbc.com time to read: +3 min

Bahamas-based crypto exchange FTX filed for bankruptcy in the U.S. on Nov. 11, 2022, seeking court protection as it looks for a way to return money to users. Senate Banking Committee Chairman Sherrod Brown urged Treasury Secretary Janet Yellen on Wednesday to work with lawmakers and financial regulators to help write legislation to rein in the cryptocurrency market in the wake of the collapse of crypto exchange FTX. Brown sent the letter the day before Congress holds its first hearing on FTX's collapse. Brown encouraged partnership between Congress, Treasury and the White House, even referencing Treasury's coordination with the President's Working Group on Financial Markets. "Congress and the financial regulators must work to get all of this right.

☆ At November Fed meeting, officials flagged market resilience amid volatile conditions
▼ + stars: | 2022-11-23 | by ( Michael S. Derby | ) www.reuters.com time to read: +3 min

Those concerns were aired in meeting minutes for the rate-setting Federal Open Market Committee’s Nov. 1-2 policy meeting, released Wednesday. Thus far, the Treasury market, which serves as the backbone of the world’s credit system, has held together, although there has been ample concern about low liquidity that’s made trading difficult. Fed officials have thus far described the market as resilient. Fed staff briefing officials concurred,The minutes flagged recent events in Britain as a point of concern. The Fed's top financial stability official, Vice Chair for Supervision Michael Barr, last week told Congress he was worried about "blowback" to the wider financial system from crypto-related failures.

SoFi pitches itself as a digital financial services company with 3.9 million members as of Q1 2022. Heightened financial and risk controls mean that SoFi's crypto activities "pose significant risks to both individual investors and safety and soundness," the lawmakers said. Investor education material from SoFi warns that a cryptocurrency offered on SoFi's crypto platform, Dogecoin, has "no special use case or features." The letters to regulators and SoFi come as crypto markets weather their worst crisis yet. Lawmakers have demanded an explanation from SoFi on its risk management, credit, financial and compliance systems by Dec. 8.

FTX's bankruptcy case includes more than 100,000 creditors, and this number could surpass 1 million, the filings said. The numbers were disclosed as FTX requested that multiple FTX group companies file one consolidated list of major creditors, rather than separate ones. REUTERS/Dado Ruvic/IllustrationCrypto lender BlockFi, which previously acknowledged it has significant exposure to FTX, plans to lay off workers while preparing to file for bankruptcy, the Wall Street Journal reported. Separately, bankrupt crypto lender Voyager Digital no longer plans to sell itself to FTX, Bloomberg reported, while Canadian crypto exchange Bitvo said it terminated its deal to be bought by FTX. I'm meeting in-person with regulators and working with the teams to do what we can for customers," he said on Twitter.

☆ Fed's Barr: Concerned about blowback to financial system from crypto
▼ + stars: | 2022-11-15 | by ( ) www.reuters.com time to read: +3 min

"That includes obviously crypto activity, but more broadly risks in parts of the financial system where we don't have good visibility, we don't have good transparency, we don't have good data. That can create risks that blow back to the financial system that we do regulate." Barr's remarks came in his first congressional testimony since becoming the Fed's top Wall Street cop over the summer and augmented his prepared comments to the committee that he was keeping a close eye for stresses in the financial system amid a weakening economy. Banks are not required to place other types of custody assets on their own balance sheets. "Wouldn't this impose a significant cost on banks if they are in fact obligated to put all of the ... crypto custody assets on their balance sheets," Toomey asked Barr.

☆ Fed's Barr: Concerned about non-bank risks, including crypto, that can 'blow back' on system
▼ + stars: | 2022-11-15 | by ( ) www.reuters.com time to read: 1 min

Nov 15 (Reuters) - Michael Barr, the Federal Reserve's top financial regulatory official, on Tuesday said he is concerned about risks from the nonbank sector, including cryptocurrencies, for which the U.S. central bank and other regulators have poor visibility. "We're concerned about the risks that we don't know about in the nonbank sector," Barr said in response to a question during an appearance before the Senate Banking Committee. "That includes obviously crypto activity, but more broadly risks in parts of the financial system where we don't have good visibility, we don't have good transparency, we don't have good data. That can create risks that blow back to the financial system that we do regulate." Reporting By Dan BurnsOur Standards: The Thomson Reuters Trust Principles.

☆ Fed’s Michael Barr Says Crypto Turmoil Highlights Potential Risks to Financial System
▼ + stars: | 2022-11-15 | by ( Andrew Ackerman | ) www.wsj.com time to read: 1 min

WASHINGTON—Tumult in the cryptocurrency market represents a red flag to the broader financial system, the Federal Reserve’s top banking regulator plans to tell lawmakers Tuesday, while pressing for tougher guardrails in the wake of the rapid collapse of crypto exchange FTX. Michael Barr , the Fed’s vice chairman for supervision, is expected to tell lawmakers that crypto-related activities need to be regulated in a manner similar to more traditional financial services providers, according to written remarks distributed ahead of Tuesday’s hearing before the Senate Banking Committee. While most crypto activities are occurring “outside of the ambit of banking regulation,” he said, that could change over time.

☆ FTX crash shares eerie similarities with Bernie Madoff, ex-regulator Sheila Bair says
▼ + stars: | 2022-11-15 | by ( Matt Egan | ) edition.cnn.com time to read: +6 min

Sheila Bair, a top regulator during the 2008 financial crisis, told CNN there are eerie similarities between the dramatic rise and fall of Bankman-Fried and FTX and that of infamous Ponzi scheme mastermind Bernie Madoff. Bair notes that 30-year-old Bankman-Fried, like Madoff, proved adept at using his pedigree and connections to seduce sophisticated investors and regulators into missing “red flags” hiding in plain sight. Up until the bankruptcy filing, FTX even had an application pending with federal regulators to clear derivatives, The Wall Street Journal reported. FTX’s bankruptcy filing indicates it had liabilities of $10 billion to $50 billion at the time of the filing. — If you are an FTX customer and want to discuss how you have been impacted by the bankruptcy, please reach out to Matt.Egan@CNN.com

☆ Senate Banking Committee Chair Brown scrutinizes banking fees as consumers struggle with inflation
▼ + stars: | 2022-11-15 | by ( Chelsey Cox | ) www.cnbc.com time to read: +3 min

The Senate Committee on Banking, Housing and Urban Affairs scrutinized predatory fees charged by banks and other financial institutions during a Tuesday oversight hearing of regulators. Committee Chairman Sen. Sherrod Brown, D-Ohio, said the biggest banks and credit unions are doing well despite historic inflation and economic uncertainty. He said the overdraft fees charged by some credit unions "can be detrimental to members and inconsistent with the system's mission." Agency examiners are requesting audits of credit union overdraft programs, including information about overdraft policies and procedures. "Our financial regulators have answered that call, and I will continue to work with them to make sure our banking and credit union system works for everyone," Brown said.

REUTERS/Elizabeth Frantz/File PhotoNov 14 (Reuters) - The Federal Reserve will likely soon slow its interest rates hikes, Fed Vice Chair Lael Brainard signaled on Monday, as the U.S. central bank tries to figure out how high borrowing costs need to go and how long they should stay there to bring down inflation. Fed Chair Jerome Powell has signaled that the central bank's next move may be smaller to give time to judge how the rapid rate hikes so far this year are affecting the economy. But he also signaled the policy rate may next year peak at a rate higher than the 4.6% level that most policymakers had expected in September. Currently the U.S. unemployment rate is at 3.7%, below the 4% level that most policymakers believe reflects a long-run sustainable rate. Recent labor market data suggests "cooling," Brainard said, and lessening wage pressures.

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