- The founder of bankrupt crypto exchange FTX, Sam Bankman-Fried, has been arrested in the Bahamas.
- The police of the Caribbean state announced that the 30-year-old American was arrested on Monday evening in his residential complex outside the capital Nassau.
- Reason are violations of a financial nature against laws of the United States and the Bahamas.
US authorities confirmed the arrest: “Tonight, Bahamian authorities arrested Samuel Bankman-Fried at the request of the US government, based on a sealed indictment filed by the US Attorney for the Southern District of New York.” prosecutor Damian Williams announced on Monday evening. He assumes that more will be known about the facts on Tuesday.
According to local media reports, the Attorney General in the Bahamas confirmed the criminal complaint from the United States. A probable extradition request from the United States would be met “immediately” as soon as a formal request had been made, it said.
Legend:
Investigations and class action lawsuits are underway in the USA against the former head of the crypto exchange FTX.
Getty Images/Bloomberg
FTX – one of the largest exchanges for cryptocurrencies headquartered in the Bahamas – collapsed a few weeks ago after enormous outflows of funds within a few days. Billions in customer funds could not be paid out. Bankman-Fried, who is often just called SBF in the crypto industry and lives in the Bahamas, announced his resignation on November 11 and filed for bankruptcy for the group in the US state of Delaware.
Serious allegations against Bankman-Fried
Investigations and class action lawsuits against Bankman-Fried are ongoing in the United States. He recently asserted that FTX had enough money to pay out customers there. Among other things, there is a suspicion that Bankman-Fried illegally transferred billions of dollars to the affiliated company Alameda Research to compensate for losses from high-risk transactions.
The Securities and Exchange Commission said Monday night it had approved separate indictments related to securities violations that would be filed with prosecutors Tuesday.
“We failed completely”
Bankman-Fried had recently defended himself against allegations of fraud. “I’ve never tried to commit fraud on anyone,” he said at a conference in New York earlier this month. Speaking from the Bahamas, Bankman-Fried said, “I saw it as a thriving business and was shocked by what happened this month.”
In hindsight, he’s ashamed. “We have completely failed,” said Bankman-Fried, referring to the multi-billion dollar risks of his crypto company.
The rise of crypto exchange FTX was once phenomenal. In less than three years, the company was valued at $32 billion and was custodians of billions of dollars on behalf of its clients.