Investing.com-- Singaporean state-backed investor Temasek Holdings said on Monday that it had reduced the compensation for the investment team and senior management responsible for recommending the now-bankrupt FTX cryptocurrency exchange.
In a statement posted on Temasek's website, Chairman Lim Boon Heng explained that although there was no misconduct by those involved in making the investment recommendation, they have taken collective accountability for their actions. The exact amount of compensation reduction was not disclosed, with the decision coming after an internal review of their involvement in the failed venture.
Temasek initiated an internal review into its FTX investment about six months ago, which led to a writedown of $275 million in the value of its holding in the failed exchange. As of March 31st, 2022, Temasek stated that its cost of investing in FTX accounted for only 0.09% of its net portfolio value (S$403 billion or $304 billion) and confirmed having no direct exposure to cryptocurrencies at present.
Prior to investing in FTX last year, Temasek claimed it had conducted "extensive due diligence" with audited financial statements indicating profitability at that time. Other investors such as SoftBank Group Corp's (TYO:9984) Vision Fund and Sequoia Capital also marked down their investments to zero following FTX's bankruptcy filing in the United States.
"With FTX...there was fraudulent conduct intentionally hidden from investors," said Lim Boon Heng regarding allegations made against key executives at both companies by prosecutors. Despite this revelation, he expressed disappointment over how the situation unfolded and acknowledged its negative impact on Temasek’s reputation.
FTX was arguably the most high-profile bankruptcy of 2022's cryptocurrency collapse, as founder Sam Bankman-Fried and other top executives faced a slew of allegations of misusing consumer funds. The exchange's value plummeted from nearly $30 billion to nil overnight, with Bankman-Fried now facing legal action in the U.S.
Disclaimer: This article was generated with the assistance of an artificial intelligence tool.