Former FTX CEOAn arrest has been made in the Bahamas based on charges filed in the US, the Attorney General’s Office of the Bahamas announced on Monday.
Bankman-Fried’s arrest followed “the receipt of formal notification from the United States that she has filed criminal charges against the SBF and is likely to request her extradition,” the Attorney General’s Office said. Told in a statement.
The US Attorney’s Office for the Southern District of New York confirmed that Bankman-Fried was in custody, adding that the arrest was made on the basis of a sealed indictment. “We expect to open the indictment in the morning and will have more to say at that time,” the SDNY said. Told,
Due to the sealed indictment, it was not immediately clear what the allegations were. The Associated Press previously reported that regulators and the Justice Department were probing whether FTX used client funds to make risky bets at Bankman-Fried’s hedge fund, Alameda Research.
Securities and Exchange Commission Told arrest after news that it had authorized separate charges relating to ” [Bankman-Fried’s] Violations of securities laws to be publicly filed tomorrow in SDNY.”
FTX was previously one of the largest cryptocurrency exchanges in the world, Users withdrew nearly $5 billion of crypto assets in a single day as concerns grew over the exchange’s solvency. Bankman-Fried resigned on November 11, and FTX filed for Chapter 11 bankruptcy protection.
John Ray III, who took over as CEO of FTX after a long career that included overseeing the Enron bankruptcy, said in court documents the following week, “I’ve never seen in my careerSuch a complete lack of corporate control and reliable financial information as is the case here.”
The court documents also accused Bankman-Fried and FTX of failing to accurately value the value of FTX’s crypto assets and disorganized management of FTX’s cash holdings.
“One of the most pervasive failings of the FTX.com business in particular is the absence of a permanent record of decision-making,” Wray wrote. “Mr. Bankman-Fried frequently communicated using applications that were set to auto-delete after a short period of time, and encouraged employees to do the same.”
The day before Bankman-Fried’s arrest, she was expected to testify at a House hearing on the collapse of crypto exchanges. he said last week that he wouldbefore Congress but warned that his comments would be limited and “not as helpful” as he purports to be. On Monday, shortly before his arrest, Bankman-Fried said at a Twitter Space event that he would “call in” for a hearing, Reuters reported.
Bankman-Fried was arrested “without incident” and is due to appear in court in the Bahamas on Tuesday, the Royal Bahamas Police Force said in a statement.
Robert Legare, Pat Milton and Christopher J. Brooks contributed reporting.