Former FTX US President Brett Harrison Starting New Company, Denies Fraud

The former president of FTX is blasting the failed crypto exchange and its founder as he pivots to raising fresh funds for his new venture.

That’s according to a 49-part Twitter thread where Brett Harrison, who served as the failed FTX cryptocurrency exchange’s one-time U.S. head since May 2021, took blistering aim at his former boss, Sam Bankman-Fried, while attempting to distance himself from the disastrous downfall of his former company.

“I never could have guessed that underlying these kinds of issues — which I’d seen at other more mature firms in my career and believed not to be fatal to business success — was multi-billion-dollar fraud,” Harrison tweeted about the disastrous FTX enterprise collapse, adding that he was “shocked” by Sam Bankman-Fried’s alleged fraud.

While other top FTX lieutenants are pleading guilty to criminal charges and cooperating with authorities in their ongoing investigation into Bankman-Fried, who has been extradited to the U.S. from the Bahamas and remains under house arrest, Harrison is not facing any criminal charges related to his tenure with the company.

Instead, he is starting a new venture — reportedly, a software company that will offer algorithmic trading services to crypto investors and provide access to both private and public markets.

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Already the former president of FTX US can count on former backers of FTX for some of his funding, with Skybridge’s Anthony Scaramucci reportedly investing.

Just a few months before imploding, FTX’s venture capital arm acquired a 30% stake in Scaramucci’s firm for an undisclosed amount.

Scaramucci said in a Friday (Jan. 13) interview with CNBC that he intends to buy back that stake, adding about the situation with his former friend and collaborator, Sam Bankman-Fried, “I think it’s very clear now that there was fraud.”

FTX was a key sponsor — and Bankman-Fried a well-publicized presence — at Skybridge’s annual SALT conference.

Harrison’s own departure from the top seat at FTX’s U.S.-based operations came six weeks before FTX’s implosion, which unfolded over a matter of days following the revelation that the company had used customer funds to prop up sister firm Alameda Research.

Scaramucci will be using his own money to support Harrison’s unnamed startup.

A proponent of the crypto industry more broadly, Scaramucci told CNBC at a crypto conference in St Moritz, Switzerland, on Sunday (Jan. 15) that he believes Bitcoin will trade “between $50,000 and $100,000” in two to three years’ time.

“You are taking on risk, but you’re also believing in adoption,” he said. That’s an approach Scaramucci is also taking by investing in Brett Harrison’s new venture.

Tweet It to Believe It

“Brett I am proud to be an investor in your new company. Go forward. Don’t look back.  Wishing you the best,” Scaramucci tweeted Saturday (Jan. 14).

The media-friendly Skybridge founder, who is also a participant in Fox’s new reality show “Special Forces,” was replying to an extensive tweet thread from Brett Harrison lashing out at Bankman-Fried and Harrison’s own experience at FTX.

As reported by PYMNTS, Harrison has said he will reveal his insights about the firm’s collapse “in time.”

“Six months into my time at the company, pronounced cracks began to form in my own relationship with Sam. Around then I began advocating strongly for establishing separation and independence for the executive, legal, and developer teams of FTX US, and Sam disagreed,” the former FTX US president tweeted.

“There was tremendous pressure not to disagree with Sam, but I did so anyway. At that time, and for all of my time at FTX US, his influence over the media, FTX’s partners, the venture capital industry, and the traditional finance industry was pervasive and unyielding,” he added.

Bankman-Fried allegedly threated to “destroy” Harrison’s professional reputation.

While Bankman-Fried never got around to explicitly doing that, the collapse of FTX and the widespread allegations of fraudulent behavior by its senior team served to similarly complicate Harrison’s post-FTX prospects, despite his background at blue-chip firms like Jane Street and Citadel.

Many conversations with investors, Harrison alleged, eventually came around to the same kind of apology in regard to them passing on providing capital for his proposed startup. “We know you weren’t involved in what Sam and others did, but we can’t take on the PR risk of associating ourselves with FTX, no matter how capable you are or compelling your idea is.”

“The scheme was held closely by Sam and his inner circle at FTX. com and Alameda,” Harrison claimed, “which I was not a part of, nor were other executives at FTX US… I worked largely independently of Sam to grow a US-based team and foster a professional environment prepared for regulated businesses.”

The perpetually online Bankman-Fried supplied a comment to Bloomberg News about his former FTX US deputy’s twitter thread, taking the high road.

“Brett was a great developer and deeply understood FTX’s product. While I strongly disagree with much of what he said, I have no desire to get into a public argument with him, nor do I feel like it’s my place to litigate his job performance in public, unless he were to authorize me to do so. I feel bad about what happened to all of FTX’s employees, and wish him the best.”

Harrison, for his part, alleged in his twitter thread that the “sensitive and curious” Bankman-Fried he once knew at Jane Street had since morphed into a “spiteful, volatile, insecure, intransigent, and prideful,” executive who “gaslit and manipulated” employees, even wondering aloud whether Bankman-Fried had begun to suffer from adult-onset “addiction or mental health” problems.

In the meantime, Harrison is a free man who is busy pitching backers and sharpening his ideas for an investor roadshow, while his former boss is under house arrest and preparing his defense for a fall trial.