The man charged with picking up the pieces from the FTX crypto collapse, John Ray, a corporate restructuring expert with decades of experience, described the mess he has seen during his first week on the job as “unprecedented.”

In a filing Thursday with the Delaware court overseeing FTX’s bankruptcy, Mr. Ray told the judge he has 40 years of restructuring experience and has supervised the aftermath of several of the largest corporate failures in history, among them energy giant Enron and the Canadian telecoms firm Nortel. Many of them, he said, involved criminal activity and malfeasance.   

“Nearly every situation in which I have been involved has been characterized by defects of some sort in internal controls, regulatory compliance, human resources and systems integrity,” Mr. Jay said in the filing. “Never in my career have I seen such a complete failure of corporate controls and such a complete absence of trustworthy financial information as occurred here.”

He added: “From compromised systems integrity and faulty regulatory oversight abroad, to the concentration of control in the hands of a very small group of inexperienced, unsophisticated and potentially compromised individuals, this situation is unprecedented.”

FTX — which at one point earlier this year was worth as much as $32 billion — filed for bankruptcy November 11 after proving itself unable to cope with a rush of customer withdrawals following reports about its financial stability. In bankruptcy court filings, the company said it may have as many as a million creditors.

Mr. Ray’s filing is an attempt to decipher what real assets exist in the ashes of FTX and its more than 100 affiliated companies around the world. His assessment of the company and its former leadership, including the chief executive, Sam Bankman-Fried, is scathing in its language.

Each of his attempts to inform the judge of FTX’s real financial positions is prefaced with the caveat that because the balance sheets presented were produced when the company was controlled by Mr. Bankman-Fried, “I do not have confidence in it, and the information therein may not be correct as of the date stated,” Mr. Ray said.

“As a practical matter,” he said, “I do not believe it appropriate for stakeholders or the Court to rely on the audited financial statements as a reliable indication of the financial circumstances” of the company’s various components.

In the filing, Mr. Ray ridiculed the only auditing firm apparently working with FTX, Prager Metis, as “one with which I am not familiar and whose website indicates that they are the ‘first-ever CPA firm to officially open its Metaverse headquarters in the metaverse platform Decentraland.’”

Under Mr. Bankman-Fried’s leadership, Mr. Ray wrote, the human resources department was in such shambles that investigators have been unable to compile a list of who actually worked for the company and what they did. “Repeated attempts to locate certain presumed employees to confirm their status have been unsuccessful to date,” he said.

FTX also had no apparent controls over disbursement of company funds, Mr. Ray noted. Employees, he said, “submitted payment requests through an on-line ‘chat’ platform where a disparate group of supervisors approved disbursements by responding with personalized emojis,” Mr. Ray said.

Corporate funds appear to have been used to purchase homes and other personal items for employees and advisors, the filing stated, and the real estate in question was recorded in the personal names of those employees in registries in the Bahamas. The transactions were not noted as loans in the corporate books, the filing stated.

While Mr. Ray does appear to reserve judgment on some of FTX’s employees — who he said were not aware of the company’s shortfalls and other shenanigans, and are among those who have been most hurt by the fiasco — his assessment of Mr. Bankman-Fried’s  management is scathing.

“One of the most pervasive failures of the FTX.com business in particular is the absence of lasting records of decision-making,” he said. “Mr. Bankman-Fried often communicated by using applications that were set to auto-delete after a short period of time, and encouraged employees to do the same.”

Mr. Ray chided Mr. Bankman-Fried, who remains in the Bahamas, for continuing to make “erratic and misleading public statements.”

“Mr. Bankman-Fried, whose connections and financial holdings in the Bahamas remain unclear to me, recently stated to a reporter on Twitter: ‘F*** regulators they make everything worse’ and suggested the next step for him was to ‘win a jurisdictional battle vs. Delaware,’” Mr. Ray noted.