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Not just FTX’s Sam Bankman-Fried: A look at five biggest CEO frauds ever


FTX founder and former chief executive officer (CEO) Sam Bankman-Fried has been charged with a number of criminal and and may face a cumulative jail term of 115 years. SBF’s fall from grace is noteworthy as he was once dubbed the “next Warren Buffet” and ran the third-largest asset in the world.

At one point, his net worth reached $26.5 billion. But just days after the details of the collapse of FTX came out, most of it vanished. It is being termed one of the biggest in history.

With this, SBF joins a long list of CEOs, heads and founders who robbed people of their money.

Five biggest CEO frauds in the history

Bernie Madoff

Bernie Madoff was an American financier who ran the biggest Ponzi scheme in history. He defrauded thousands of investors of over $65 billion over the course of 17 years. Considered the pioneer of electronic trading, Madoff served as the chair of Nasdaq in 1990, 1991 and 1993.

His Bernard L Madoff Investment Securities LLC guaranteed “high returns”, but no physical proof of returns was ever given to the investors.

In 2008, Madoff was charged with 11 counts of fraud, money laundering, perjury and theft. He was given a jail term of 150 years. He was also forced to forfeit $170 billion.

Madoff died on April 14, 2021, from chronic kidney disease.

Elizabeth Holmes

Elizabeth Holmes founded Theranos, a start-up that claimed to be able to run several diagnostics tests and come up with accurate results from just a drop of blood. For this, the company promised to invent a compact machine.

The “next-level” technology and the machine were never actually made. Holmes continued to show false reports to the regulators and the inspectors. The company even installed their devices at several Walgreens stores.

Holmes became the youngest female billionaire in history.

In 2015, a report by the Wall Street Journal made people question the technology and medical methods being used by . The truth that Holmes had outrightly lied came forth.

The company was charged with fraud of over $700 million. In November, Holmes was given a jail term of 11 years for defrauding investors.

Trevor Milton

Trevor Milton founded Nikola Motor in 2014 with an aim to build semi trucks that could run on batteries and hydrogen. Milton claimed that his company could make zero-emission trucks back in 2014. Most of the major auto companies of the world were taken by shock by the relatively new and unheard-of company.

In just two years, in 2016, the company unveiled its Nikola One truck, which was fuelled by a hydrogen fuel-cell powered generator. Milton launched the truck at a grand ceremony. However, reports soon emerged that the truck could not run and was just a model made of metal sheets.

Soon, the company released the video of the truck running on a highway. Later, a whistleblower told the media that the truck was released from the top of a hill just to shoot the video. It was not actually operational.

Milton continued making tall promises but could not deliver even one product. In 2020, he stepped down from the post of CEO. In October, he was found guilty on three charges of fraud and manipulation to drive up the company’s share price. At its peak in 2020, the company’s market cap was over $21 billion.

Markus Braun

Markus Bruan was the CEO of one of Germany’s biggest financial firms, Wirecard. It rocketed to fame in the 2010s by being one of the biggest electronic payments firms in the world.

In 2020, the firm’s auditors reported that $2 billion was missing from the company’s books. The reports damaged the German regulator’s reputation, which reportedly overlooked questions about the company’s dealings for over a decade. The company declared bankruptcy.

Braun stepped down from his position in 2020 and was charged, along with two other former executives of Wirecard, of defrauding the creditors of $3.7 billion through false accounting. It was also claimed that the company reported an inflated income.

The case rocked the German as well as European regulators. Braun is currently undergoing trial. It is estimated that the total scale of the scandal is around $4 billion.

Enron Corporation

Awarded “America’s most innovative company” for five years straight between 1996 and 2001, innovative energy company Enron was the darling of Wall Street. At the peak of its valuation, it was the seventh biggest company in the USA.

For years, it continued to fool investors. In 2001, the company went bust after it was discovered that it was hiding all of its losses in shell companies to inflate the profits. In just four months, the company’s share price fell from $90 apiece to 26 cents.

The scam resulted in a wipeout of $74 billion in lost funds. The auditing firm Arthur Anderson was also dragged along with it as it lost most of its clients after the Enron case came to light.

Various company executives, including CEO Jeffrey Skilling, were charged with fraud.


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