Call it the millennial-ification of fraud.
To the apparent disbelief of the internet, Congress, and a corporate fraud expert, now-disgraced FTX and its affiliated companies — which were once worth billions of dollars — were using QuickBooks for accounting.
The company’s new CEO, John Ray, testified as much at a hearing before Congress on Tuesday, for the House Financial Services Committee.
There was “no recordkeeping whatsoever,” he said. “They used QuickBooks, a multibillion-dollar company using QuickBooks,” he said.
“Quickbooks?” sputtered Representative Ann Wagner (R-Missouri) in response to Ray’s revelation. The video of Ray’s testimony and her reaction quickly grew popular on Twitter.
FTX CEO John Ray: “Literally, there’s no record keeping whatsoever…They used QuickBooks…nothing against QuickBooks, very nice tool, just not for a multi-billion dollar company.” pic.twitter.com/5jfRoyGEwd
— CSPAN (@cspan) December 13, 2022
“Nothing against QuickBooks, [it’s] a very nice tool, just not for a multibillion-dollar company,” Ray added. QuickBooks did not immediately respond to a request for comment.
Ray added that the company was using Slack (and emojis) to approve expenses. The CEO had previously led scandal-ridden companies like Enron through bankruptcy processes.
QuickBooks is owned by Intuit, which also owns Mint and TurboTax. It is marketed as an accounting and tax tool for small businesses to do things like manage expenses and invoices. In a commercial for the service posted earlier this year, “small business owners” joke about feeling self-conscious about knowing more about how to build furniture than manage a payroll.
Sam Bankman-Fried founded FTX after he created Alameda Research. The group of companies collapsed last month after questions emerged about the balance sheet of Alameda Research, which looked to be dependent on an asset that did not really have independent value, which led to customer panic withdrawals, and, eventually, revelations FTX had used customer money to fund trades at Alameda.
At the hearing, Ray didn’t mince his words. “This is really just old-fashioned embezzlement. This is just taking money from customers and using it for your own purpose,” Ray said, per CNBC.
Bankman-Fried is now detained in the Bahamas facing criminal charges.
Twitter users marveled at the use of a tool more common to a local coffee shop than managing billions.
“So for those of us that are like ME and don’t know what that is, how bad is that?” one user wrote.
“Like using windows movie maker to edit hollywood productions i guess,” another user replied. Windows Movie Maker was movie-editing software on Microsoft laptops.
Like using windows movie maker to edit hollywood productions i guess
— wyskiell (@wyskiell) December 13, 2022
There were a few other jokes:
Nothing like saving a couple bucks when dealing with billions, brilliant!
— Huskydog (@curthoser) December 14, 2022
And a few other similes:
Shooting an avengers film on a I phone 3
— Kevin (@Kevin48636739) December 13, 2022
One person compared it to building a highway with a rake and shovel:
Yeah like building a highway with a rake and a shovel
— Abe (@skatetdieu) December 13, 2022
