According to Temasek’s internal review, no inappropriate behavior was found. However, the employees who were involved with the FTX investment will experience a reduction in their compensation.
Temasek Holdings, a Singaporean investment firm, has implemented a decrease in remuneration for the executives who were accountable for the organization’s investment in the now-defunct cryptocurrency exchange, FTX. Forbes reports that Temasek was the second-largest external investor in FTX, holding 7 million shares. However, the investment decision was called into question following the exchange’s collapse.
Bloomberg has reported that Temasek has completed its internal investigation into the $275 million financial loss that resulted from its investment in FTX, following the exchange’s collapse in November 2022. The review determined that there was no evidence of any wrongdoing within the organization. However, it was noted that both the investment team and senior management took responsibility for the loss, and as a result, their compensation was reduced.
Temasek writes off $275 million FTX investment, amounting to 0.09% of its $293 billion portfolio value, and claims to have conducted extensive due diligence before investing.
In a separate statement to Bloomberg on May 29, Temasek’s chairman, Lim Boon Heng, indicated that the organization was unaware of fraudulent conduct that was deliberately concealed from investors, including Temasek, and that this has had a significant impact on the company. As a result, Temasek expressed disappointment with the investment outcome and the negative effect it has had on the organization’s reputation.
Singapore’s Deputy Prime Minister, Lawrence Wong, echoed similar sentiments during a parliamentary meeting in November 2022, shortly after FTX’s collapse, emphasizing that the incident resulted in both financial losses and reputational harm to Temasek.
Temasek has reported that it conducted a thorough due diligence process, which involved examining FTX’s financial statements, evaluating regulatory risks associated with financial service providers in the cryptocurrency market, and obtaining legal counsel over a nine-month period from February to October 2021. Additionally, the company interacted with individuals who had first-hand knowledge of FTX, including employees, other investors, and industry experts.
Temasek has refuted claims that it invested $10 million in Array, the company responsible for developing an algorithmic currency system that utilizes smart contracts and artificial intelligence. The organization issued a brief statement on May 2, rejecting the circulating news articles and tweets concerning its investment, and declaring that such reports are inaccurate.
