As a sports ethics keynote speaker and sports ethics consultant, as well as a business ethics keynote speaker and business ethics consultant, Chuck Gallagher is always wary of can’t miss “deals” and where they might lead.
Sam Bankman-Fried is not an NBA player
Sam Bankman-Fried is the failed CEO of the bitcoin trading platform known as FTX. While the bitcoin concept is not an easy investment to explain, indications are that FTX was a more opaque financial play than most.
What I do know about FTX was that Bankman-Fried was an industry Rockstar who attracted investment (lots of it) and celebrities (lots of them). The first time we heard Bankman-Fried speak, he sat on a stage surrounded by sycophants who hung onto his every word. After all, he is young and bold, says all of the right things and on paper was a multi-billionaire.
He spread the money around, and he noticeably was attracted to sports. Why? Because he could. He entered into sports marketing agreements with several basketball teams, a football team, Mercedes racing and superstar athletes such as Tom Brady, Steph Curry and Naomi Osaka. And yes, it is true MLB baseball umpires wore FTX logos on their uniforms. It is a true touch of irony.
FTX has gone belly-up and none of the in-house, dreamy-eyed employees can seem to explain the nose-dive. Bankman-Fried, a genius in his own mind, can’t seem to explain the bankruptcy either. On Friday, November 11, 2022, he cryptically wrote on his Twitter account after being asked to explain how billions disappeared into the mist:
“I will, soon, write up a more complete post on the play by play, but I want to make sure that I get it right when I do.”
He is, after all, the FTX CEO. If he is flummoxed as to what his company did to spiral to earth, the poor schnooks’ who have lost their shirts must be downright ecstatic. We might ask the Chief Financial Officer of FTX what happened, but from what we understand there was no CFO; just the sycophants who seem to have jumped ship. It is the same behavior we have witnessed when the hangers-on leave world class athletes who have fallen on hard times.
Another inconvenient truth that has apparently surfaced is that something like $663 million appears to be missing from the FTX coffers. This fact, and others, is creating interest from Bahamian financial regulators which could cascade to other regulators.
Miami-Dade County
The Miami-Dade County stadium people and the team they host, the Miami Heat, are the latest to end the arena FTX naming agreement. Other teams are scraping, removing and tearing down logos as well. As FTX is bankrupt, they can’t meet the naming rights installments to any team. Said the Miami Heat organization and the county:
“The reports about FTX and its affiliates are extremely disappointing. The Miami-Dade County and the Miami HEAT are immediately taking action to terminate our business relationships with FTX. We will be working together to find a new naming rights partner for the arena.”
Sports Ethics has been flippant with this post, we know, however it is anything but humorous. In fact, the relationship between FTX and several teams and sports personalities is painfully reminiscent of so-called financial advisors, unscrupulous agents and other deal-makers who have taken many athletes for terrible rides to ruin.
All kinds of tragedies can occur to athletes and accidents happen but some are preventable with due-diligence and ethics counseling. Every choice has a consequence. Time and ethics will be the judge of Bankman-Fried.
Unethical behavior roars back to punish those who feel above the law. And most unfortunately, the most unsuspecting are often caught in their webs.
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