Former FTX US president Brett Harrison accused FTX founder Sam Bankman-Fried (SBF)of “gaslighting and manipulation” in a Twitter thread on Jan. 14. Harrison left FTX.US in September 2022, two months before SBF’s crypto empire collapsed.
Sharing his experience during the 17 months running FTX US, Harrison said that SBF resorted to cutting him off from critical decisions about the US division of FTX when things soured between the two.
SBF asked his former colleague Harrison to join FTX US “casually over text” in late March 2021. Harrison joined the firm in May and worked “largely independently” of SBF for the first few months.
But things changed as Harrison noticed that SBF made impactful decisions about FTX US “without warning” despite being “rarely engaged” in the FTX.US business. As a result, by October 2021, “pronounced cracks” developed between Harrison and SBF, the former wrote.
Harrison began pushing for “establishing separation and independence” for the executive, legal, and developer teams of FTX US, but SBF disagreed. Harrison wrote:
“I saw in that early conflict his [SBF’s] total insecurity and intransigence when his decisions were questioned, his spitefulness, and the volatility of his temperament. I realized he wasn’t who I remembered.”
At the time, SBF’s influence over FTX partners, the media, venture capital firms, and the traditional financial industry was “pervasive and unyielding,” Harrison wrote. Moreover, SBF was a prominent political donor and dined with the who’s who of Washington. Detailing his dilemma, Harison added:
“Standing up to an insecure, prideful manager is hard under any circumstance. But it’s nearly impossible when every day, every major voice of culture and commerce deafens you with a narrative that implies if you disagree with your manager *you* clearly must be wrong.”
Harrison stood up to him despite feeling “tremendous pressure not to disagree” with SBF. And he was not the only staff of FTX US who disagreed with SBF’s decisions.
Harrison recounted that the experience and understanding of FTX US employees were frequently treated as “irrelevant and valueless,” which made it “extremely frustrating” for all staff.
Over the following months, Harrison advocated for implementing a “sensible hiring policy” and employing experienced C-suite officers in FTX US. He also pushed for “transparent communication” between SBF and the leadership team of the US division.
Harrison argued to have FTX co-founder Gary Wang and engineering chief Nishad Singh’s responsibilities “formally identified” and shared among a larger group. Additionally, Harrison suggested expanding “managerial responsibility and controls” beyond SBF and his inner circle.
These disagreements elicited an unpalatable response from SBF, Harrison wrote.
“Sam was uncomfortable with conflict. He responded at times with dysregulated hostility, at times with gaslighting and manipulation, but ultimately chose to isolate me from communication on key decision-making.”
Harrison had to scramble to find out information about the decisions made behind his back, “but trying hard not to show it.”
In early April 2022, Harrison put up one last fight by making a written formal complaint about what he perceived to be the “largest organizational problems inhibiting FTX’s future success.” In the complaint, he mentioned resigning if the issues were not fixed.
In response, an executive “threatened” Harrison on behalf of SBF. Harrison was warned that unless he formally withdrew his complaint, he would be sacked and see his professional reputation annihilated by SBF.
Harrison was also asked to deliver an apology to SBF that had been drafted for him. This incident solidified Harrison’s resolve to leave FTX US, he wrote. As a result, he gradually “wound down” instead of going abruptly to avoid impacting the firm negatively and finish ongoing projects.
The revelations of fraud that became public soon after the collapse of FTX are “difficult for me to assimilate into reality,” Harrison wrote. However, he added that the organizational and management issues he had highlighted during his tenure were typical in growing startups.
“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 added that the fraud was perpetrated by SBF and his inner circle — as evident from indictments and guilty pleas — and that he and other FTX US employees had no part in it.
He stated that the criminal activities were “carefully concealed” from FTX US executives because these executives had extensive professional networks, “our own lines of communication with US regulators, and our own authority to speak to US media.”
Harrison said that if any FTX US executives had any suspicions about the criminal activities, they would have immediately informed the authorities.