FTX's New CEO John J. Ray III Is No Stranger To Corporate Bankruptcy
John J. Ray III, the new CEO of crypto exchange FTX, has not minced words about his new responsibilities with the bankrupt company. As we've quoted before, in his first analysis Ray said he had "never seen such a failure of corporate control."
That's no small statement coming from Ray. A specialist in bankruptcy and corporate restructuring, John J. Ray has been a major player in the investigation and asset redistribution of, among others, Fruit of the Loom and the scandal-shattered Enron (via Forbes). At Enron and elsewhere, Ray has also dealt with issues of fraud, which may also be relevant to piecing together the story of the bankrupt former crypto giant.
In short, when incompetence is certain and malfeasance likely, Ray seems like the person you call. Forbes beat us to the phrase, but it seems only apt — it appears Ray will be FTX's adult in the room, cleaning up Sam Bankman-Fried's financial mess.
Picking up the FTX pieces
At the same time, when the adult in the room describes the business as a "complete failure of corporate controls and ... a complete absence of trustworthy financial information" (via Financial Times), there's clearly serious work ahead. Some of it has already begun. Per Ray at the Financial Times:
"Based on our review over the past week, we are pleased to learn that many regulated or licensed subsidiaries of FTX, within and outside of the United States, have solvent balance sheets, responsible management, and valuable franchises."
With FTX's unaccounted-for assets, which may reach $8 billion in value, Ray and his team have already recovered $1.24 billion. Ray's plan to track down FTX's missing assets, restructure, and effectively sell the crypto exchange for scrap should at least prove valuable to some extent. It is Ray's profession to turn insolvency into an acceptable balance sheet and livable future for a floundering company's stakeholders. FTX may seem like an unmitigated disaster, but so was Enron; and per PYMNTS, John Ray still paid out its creditors at 52 cents on the dollar.