CONGRESS MAY NEED TO STEP IN.
LET’S MOVE ON TO THIS STORY.
WELCOME TO THE SHOW CONGRESSMAN
FRENCH HILL FROM HOUSE FINANCIAL
SERVICES, RANKING MEMBER OF
HOUSE BUDGET, HE IS CONGRESSMAN
JASON SMITH.
GREAT TO SEE YOU BOTH.
HAPPY THANKSGIVING.
>> HAPPY THANKSGIVING, LIZ.
ELIZABETH: GOOD TO SEE YOU.
CONGRESSMAN HILL, THIS
DISTURBING CASE OF CORRUPTION
AND GREED.
FTX UNIT, THE CRYPTO EXCHANGE
THAT COLLAPSED SPENT
$300 MILLION ON LUXURY MANSIONS
IN THE BAHAMAS.
BANKMAN-FRIED SPENT $19 MILLION
ON LUXURY PROPERTIES FOR SENIOR
STAFFERS AND A $16.4 MILLION
LUXURY HOME FOR HIS PARENTS,
STANFORD UNIVERSITY PROFESSORS.
CONGRESSMAN HILL, YOU SIT ON AN
OVERSIGHT COMMITTEE.
IS D.C. NOT ABOUT THE LITTLE GUY
ANYMORE?
>> ISN’T THIS DISGUSTING?
AND WHAT’S MORE DISGUSTING ABOUT
IT AFTER COMPLAINING ABOUT
CRYPTO FINANCE FOR FOUR YEARS
THE DEMOCRATS ARE ON THE TAKE
FOR OVER ALMOST $40 MILLION OF
CAMPAIGN CONTRIBUTIONS FROM
BANKMAN-FRIED AND FTX
AFFILIATES.
I HOPE THEY GIVE ALL OF THAT
MONEY BACK BEFORE WE HAVE OUR
OVERSIGHT HEARING IN EARLY
DECEMBER AND TRY TO GET TO THE
BOTTOM OF WHAT IS CLEARLY AN
OUTRAGEOUS MISAPPROPRIATION OF
FUNDS AND FRAUD BY BANKMAN-FRIED
AND HIS COLLEAGUES AND IT’S
PRETTY SAD THAT HIS PARENTS ARE
PROFESSORS AT STANFORD LAW
SCHOOL.
WHAT DOES THAT TELL YOU ABOUT
THE QUALITY OF THE LAW SCHOOL?
ELIZABETH: REPORTEDLY TO THE
CONGRESSMAN’S POINT, CONGRESSMAN
SMITH, THE PARENTS ARE
REPORTEDLY TRYING TO GIVE THE
DEED BACK.
EVEN BOUGHT CONDOS IN THE SWANKY
BAHAMAS RESORT WHERE TIGER WOODS
HAS HIS ANNUAL POSITIVELY
TOURNAMENT.
SEVEN DEMOCRATS SIT ON HOUSE
FINANCIAL SERVICES.
MAXINE WATERS CAUGHT BLOWING A
KISS TO BANKMAN-FRIED IN
DECEMBER OF LAST YEAR.
HE GAVE OUT MORE THAN 40 MILLION
TO DEMOCRATS, RIGHT, CONGRESSMAN
SMITH?
THAT IS MORE THAN 200,000 OR SO
THAT REPUBLICANS GOT.
>> LIZ, HE WAS THE SECOND
LARGEST CONTRIBUTOR RIGHT BEHIND
GEORGE SOROS TO ALL DEMOCRATS.
YOU’RE TALKING ABOUT TENS OF
MILLIONS OF DOLLARS, GIVING THAT
MONEY WITH PROBABLY THE
EXPECTATION THAT THE DEMOCRATS
WOULDN’T LOOK UNDERNEATH THE
HOOD OF HIS CORPORATE DEALINGS?
WELL MAYBE, MAYBE HE WAS JUST
ABLE TO TAKE CARE OF THAT?
THAT IS WHY THE DEMOCRATS DID
NOT DO OVERSIGHT.
THINK ABOUT THIS, IN THE HOUSE
WAYS AND MEANS COMMITTEE THERE
HAS BEEN LESS THAN 15 HEARINGS
OVER THE LAST GO HEARSE.
THREE OF THOSE HEARINGS WAS ALL
ABOUT GIVING TAX BREAKS TO THE
WEALTHY POLITICAL DONORS.
OF COURSE THEY WILL NOT GIVE
OVERSIGHT, HAVING A AGGRESSIVE
OVERSIGHT ON SOMEONE WHO HAS THE
SECOND MOST AMOUNT OF MONEY OF
ALL DONORS.
ELIZABETH: WHAT WILL YOU DO?
TO CONGRESSMAN SMITH’S POINT, WE
BROKE THE NEWS LAST WEEK,
CONGRESSMAN HILL, HE SET ASIDE
$4 BILLION, MORE THAN $4 BILLION
OF LOANS OUT OF INVESTOR MONEY
FOR HIMSELF AND HIS CRONIES.
HALF A BILLION DOLLARS FOR HIM.
HALF A BILLION FOR HIS FOUNDER,
HIS COFOUNDER RATHER.
CONGRESSMAN HILL FTX TENTACLES
RAN DEEP IN D.C.
WHO IS WATCHING OUT FOR THE
LITTLE GUY?
WHO IS WATCHING OUT FOR THE
WATCHDOGS?
HE PACKED HIS BOARD WITH FORMER
CFTC COMMISSIONER, ACTING CHAIR
UNDER OBAMA, FORMER CHIEF
OPERATING OFFICER OF CFTC.
SO WHAT ARE YOU GUYS GOING TO DO
ABOUT THIS?
>> LIZ, THANK YOU, FOR YOUR
PERSISTENT INVESTIGATIVE
JOURNALIST ATTITUDE BECAUSE
YOU’VE BEEN GREAT ON THIS TOPIC.
REALLY DO.
YOU’VE BEEN FIRST ON THE NEWS OF
THIS ITEM.
WE HAVE A HEARING IN DECEMBER, I
HOPE WE USE OUR SUBPOENA POWER
NOT ONLY BRING FTX TO THE TABLE
BUT ANYONE ADVISING FTX INVITE
THE CHAIRMAN OF THE SEC, GARY
GENSLER, HAVE ALL THE DOCUMENTS
OF ALL THE MEETINGS HE HAD WITH
FTX OR FTX ADVISORS BECAUSE
AMERICAN INVESTORS WE’RE
INVOLVED IN LOSING MONEY IN THIS
BAHAMA BEACH PARTY OF
BANKMAN-FRIED.
WE WANT TO GET TO THE BOTTOM OF
IT, TO MAKE SURE HE IS HELD
ACCOUNTABLE AND THAT THE
REGULATORS ARE HEALTH ASKEDDABLE
HERE FOR AMERICAN INVESTORS.
ELIZABETH: WILL YOU, SIT TIGHT A
SECOND, CONGRESSMAN SMITH.
ARE DEMOCRATS ON HOUSE FINANCIAL
SERVICES GIVING YOU A HARD TIME
ABOUT THIS?
WHAT ARE THEY SAYING NOW?
>> ON WHAT BASIS?
ELIZABETH: CONGRESSMAN HILL,
SORRY.
>> I’M SURE THEY WILL HAVE ONE.
LOOK I’M SURE THEY MAY HAVE SOME
BUT LOOK, THEY HAVE BEEN VERY
SKEPTICAL OF CRYPTO AND YET THEY
TOOK THIS CAMPAIGN CONTRIBUTION.
THAT IS WHAT I FIND HYPOCRITICAL
ABOUT IT.
BUT THIS HEARING IS A JOINT
HEARING THAT IS CALLED BY
PATRICK McHENRY OF THE
REPUBLICANS AND MAXINE WATERS OF
THE DEMOCRATS.
LET’S MAKE IT THE STARTING POINT
OF GETTING TO THE FACTS AROUND
THIS FTX COLLAPSE.
ELIZABETH: YOU KNOW, TO WHAT
CONGRESSMAN HILL IS SAYING,
CONGRESSMAN SMITH, CFTC, THAT IS
HIS COMPANY’S REGULATOR.
HE LOBBIED AND WEAKENED
GOVERNMENT OVERSIGHT THERE.
HE WANTED ONLY CFC, NOT THE SEC
TO REGULATE HIM.
HE WANTED TO CLEAR ALL TRADES
THROUGH THE CFTC WERE NO
GUARDRAILS OR SAFETY NETS.
GARY GENSLER APPARENTLY TAUGHT
WITH BANKMAN-FRIED’S FATHER.
THERE IS A LOT OF WEIRD INSIDER
CRONYISM HERE, YOU KNOW WHAT I
MEAN?
>> LIZ, THOSE POINTS YOU BROUGHT
UP, I WILL AGREE WITH
CONGRESSMAN HILL.
YOU’RE DOING AN INCREDIBLE JOB
INVESTIGATING THIS BUT ALL OF
THOSE POINTS YOU BROUGHT UP IS
EXACTLY WHAT NEEDS TO BE CALLED
UP IN OVERSIGHT HEARINGS.
THESE PEOPLE NEED TO COME BEFORE
CONGRESS.
AFTER JANUARY 3rd WHEN THE
REPUBLICANS HAVE THE GAVEL,
WHETHER IT IS FINANCIAL
SERVICES, WHETHER THE WAYS AND
MEANS COMMITTEE, WHETHER THE AG
COMMITTEE WE NEED TO CALL THEM
ALL UP IN ALL AREAS OF
JURISDICTION AND GET DOWN TO WHY
AND HOW THIS HAPPENED.
ELIZABETH: YOU KNOW, I
APPRECIATE YOU GUYS, THAT IS
VERY KIND AND GENEROUS OF YOU.
YOU KNOW I COVERED CORPORATE
ACCOUNTING SCANDALS FOR
"THE WALL STREET JOURNAL" IN THE
’90s.
IT FEELS LIKE WE’RE BACK HERE AT
THE SAME PLACE, CONGRESSMAN
HILL, WHERE, YOU KNOW, POLITICAL
DONATIONS COME IN TO THESE
POLITICIANS THAT SIT ON THE
OVERSIGHT COMMITTEES TASKED WITH
DOING OVERSIGHT AND THEN THESE
COMPANIES COMPLAIN TO THOSE
POLITICIANS AND WEAKEN THE
OVERSIGHT OF THE MARKET
REGULATORS.
LET’S LISTEN TO TERRY DUFFY.
HE RUNS THE CME, THE MARKET
REGULATOR FOR DERIVATIVES.
YOU WILL SEE CONGRESSMAN DUSTY
JOHNSON.
HE IS ABOUT LOSING HIS MIND.
HE WAS ON OUR SHOW WITH US
EARLIER IN THE WEEK.
WATCH THIS.
>> HE DIDN’T KNOW THE DIFFERENCE
BETWEEN REGULATORY CAPITAL AND
MARGIN CAPITAL T MADE ME LAUGH.
DISMISSIVE WHEN IT COMES TO A
GUY LIKE THAT.
CAN YOU IMAGINE THE HUMAN BEING
COULD HAVE DONE TO OUR COUNTRY
AND THE WORLD?
PEOPLE LITERALLY, LITERALLY WERE
TURNING A BLIND EYE TO IT.
IT IS ABSOLUTELY AN EMBARASSMENT
WHAT WENT ON.
I KNEW HE WAS A FRAUD THE I MET
HIM.
IT WAS QUITE EASY TO PICK OUT.
>> I’M JUST SO FRUSTRATED, WE
HAD MORE TIME FOR DEFUNDING THE
POLICE OR INFLATION REDUCTION
ACT, GREEN NEW DEAL BUT SPEAKER
PELOSI IS NOT WILLING TO PUT
BILLS I SUPPORT ON THE FLOOR.
IT IS AMAZING TO ME
SAM BANKMAN-FRIED HAS BEEN
HONEST ABOUT THIS, LIZ.
HE SAID THIS, YOU KNOW WHAT?
IF YOU SAY THE WOKE AND ENLIGHT
EDGED THINGS THE LEFT WILL
CELEBRATE YOU IF YOU DON’T HAVE
ANYTHING ON YOUR BALANCE SHEET.
THAT IS TERRIFYING.
WE HAVE TO DO BETTER.
>> HERE’S THE THING,
SAM BANKMAN-FRIED, HIS ACTIVITY
TOOK OFF WHEN JOE BIDEN, HE
REALLY STARTED TO GET AGGRESSIVE
IN 2020, 2021.
HIS COMPANY STARTED TO LOSING
MONEY DURING THE BULLISH CRYPTO
MARKET RUN.
IT WAS LOSING MONEY.
SO THE CONGRESSMAN HILL, FIRST
TO YOU, WHAT WERE DEMOCRATS
DOING THIS WHOLE TIME WHILE THIS
THING WAS BLOWING UP?
>> WELL, PATRICK McHENRY, OUR
RANKING MEMBER ON THE COMMITTEE
WORKED, TRIED TO WORK FOR OVER A
YEAR TO HAVE A BIPARTISAN
DIGITAL ASSETS BILL WHERE WE
DEFINE DIGITAL ASSETS AND THEN
WE DEFINE HOW BEST TO REGULATE
THEM AND HE HAS BEEN FORESTALLED
BY MAXINE WATERS UNTIL THIS PAST
SEPTEMBER WHEN SHE BEGAN TO WORK
CONSTRUCTLY WITH HIM ON A
STABLECOIN, DIGITAL ASSETS BILL,
NOW STILL IN THE WORKS BUT THE
POINT IS, WE HAVE AN ENRON
MOMENT IN 2022 WITH THE COLLAPSE
MUCH TERRA, LUNA, OTHER THINGS
ARE IN JEOPARDY, NOW THE
COLLAPSE ON FTX.
WE HAVE TO GET A HANDLE ON IT
AND HANDLE ON IT NOW.
WE HAVE TO HAVE A HEARING IN
DECEMBER.
ELIZABETH: THERE IS CONTAGION,
TWO BILLION IN LOSSES IN CRYPTO
POTENTIALLY.
WHAT HAVE DEMOCRATS BEEN DOING
THIS WHOLE TIME WHILE THIS HAS
BEEN RAMPING UP?
>> LIZ, THE LAST TWO YEARS,
COMPLETE DEMOCRAT ONE PARTY RULE
IN WASHINGTON THEY HAVE BEEN
DOING THREE THINGS.
THEY HAVE BEEN BENEFITING THEIR
WEALTHY DONORS.
THEY HAVE BEEN BUILDING THE
BUREAUCRACY AND THEY HAVE BEEN
BANKRUPTING OUR ECONOMY BY
SPENDING TRILLIONS OF DOLLARS.
IF YOU DONATED TO THE DEMOCRAT
PARTY YOU WERE BENEFITING UNDER
THE ONE PARTY DEMOCRAT RULE.
THAT’S THE POLICIES THEY PUSHED.
>> FEELS SO BAD.
THE LITTLE GUY FEELS THE SYSTEM
IS RIGGED AGAINST HIM.
CONGRESSMAN HILL, IT CAN’T