Singapore Wealth Fund Cuts Pay Amidst FTX Fallout

Singapore’s sovereign wealth fund Temasek Holdings said on Monday it has reduced pay for the staff responsible for its $275 million (£223m) investment in collapsed cryptocurrency exchange FTX, as well as for the fund’s senior management team.

The fund said those involved had taken “collective accountability” for the failed investment.

Temasek wrote off the entirety of the investment in November after FTX filed for bankruptcy.

“Although there was no misconduct by the investment team in reaching their investment recommendation, the investment team and senior management, who are ultimately responsible for investment decisions made, took collective accountability and had their compensation reduced,” said Temasek chairman Lim Boon Heng in a statement on Monday.

Pay cut

The fund did not detail the amount by which pay had been cut.

Temasek said the FTX investment represented 0.09 percent of its net portfolio value of S$403bn ($298bn, £241bn), and that it now had no direct exposure to the crypto sector.

But the fund said it was “disappointed” with the “negative impact” of the collapse on its reputation.

Singapore deputy prime minister Lawrence Wong in December also said the FTX debacle had reflected badly on Temasek’s reputation.

“The fact that other leading global institutional investors like BlackRock and Sequoia Capital also invested in FTX does not mitigate this,” said Wong, who is also finance minister.

‘Profitable’

Temasek invested $210m in a first funding round in October 2021 followed by $65m in a January 2022 round.

Last year Temasek said that before making the investments it had spent eight months evaluating FTX, including analysing an audited financial statement “which showed it to be profitable”.

In December prosecutors announced eight criminal charges against FTX former chief executive Sam Bankman-Fried connected with the collapse, including wire fraud, money laundering and campaign finance violations, followed by another five charges in March.

He is accused of carrying out an “epic” fraud that cost investors billions of dollars. Bankman-Fried denies wrongdoing.