New Kraken CEO Says Alleged Fraud Was Committed at FTX

The incoming CEO of crypto exchange Kraken says FTX founder Sam Bankman-Fried is an alleged “fraudster.”

“We have information to know that fraud was committed there,” Dave Ripley told Bloomberg Television. “It’s going to take time for regulatory bodies and government to come into the fold.”

In an article published Wednesday (Dec. 7), Ripley — who is set to replace Kraken founder Jesse Powell as CEO in the months ahead — also criticized recent comments by JPMorgan Chase CEO Jamie Dimon about cryptocurrencies.

PYMNTS has reached out to Kraken for comment.

Bankman-Fried, who stepped down as chief executive of FTX amid the company’s collapse and bankruptcy, has not been charged with any crime connected to the crisis. He has denied trying to defraud customers but has admitted serious lapses of oversight.

He’s also apparently retained a new attorney. As PYMNTS reported Wednesday, Bankman-Fried said he’s hired had hired Mark S. Cohen, who represented convicted high-profile sex trafficker Ghislaine Maxwell.

Ripley also told Bloomberg he expected the fallout from FTX’s collapse to continue to pose a problem for his industry at large.

“It’s clear there’s going to be more contagion from FTX,” Ripley said, though Kraken is not impacted by it.

That’s not to say Kraken hasn’t been impacted by the broader crypto winter, which led the company to lay off 30% of its staff — 1,100 workers — last month.

“Since the start of this year, macroeconomic and geopolitical factors have weighed on financial markets,” Powell said in a post on the company blog. “This resulted in significantly lower trading volumes and fewer client sign-ups.”

Meanwhile, Ripley also took issue with Dimon’s recent comments that cryptocurrencies are “pet rocks,” saying it showed the CEO did not understand the technology behind digital assets.