FTX Collapse: Sam Bankman-Fried Arrested in the Bahamas on US Government Request

The previous CEO of failed cryptocurrency agency FTX, Sam Bankman-Fried, has been arrested within the Bahamas on the request of the US authorities, US and Bahamian authorities stated Monday.

The arrest was made Monday after the US filed felony expenses which might be anticipated to be unsealed Tuesday, in response to US Legal professional Damian Williams. Bankman-Fried had been underneath felony investigation by US and Bahamian authorities following the collapse final month of FTX. The agency filed for chapter on November 11, when it ran out of cash after the cryptocurrency equal of a financial institution run.

“We count on to maneuver to unseal the indictment within the morning and may have extra to say at the moment,” Williams stated.

Bahamian Legal professional Basic Ryan Pinder stated the Bahamas would “promptly” extradite Bankman-Fried to the US as soon as the indictment is unsealed and US authorities make a proper request. FTX is headquartered within the Bahamas and Bankman-Fried has largely remained in his Bahamian luxurious compound in Nassau because the firm’s failure.

A spokesman for Bankman-Fried had no remark Monday night. Bankman-Fried has a proper to contest his extradition, which might delay however unlikely cease his switch to the US.

Bankman-Fried’s arrest comes only a day earlier than he was as a consequence of testify in entrance of the Home Monetary Companies Committee. Rep. Maxine Waters, D-Calif., chairwoman of the committee, stated she was “disenchanted” that the American public, and FTX’s clients, wouldn’t get to see Bankman-Fried testify underneath oath.

Bankman-Fried was one of many world’s wealthiest individuals on paper, with an estimated internet value of $32 billion. He was a distinguished persona in Washington, donating tens of millions of {dollars} towards principally left-leaning political causes and Democratic political campaigns. FTX grew to turn out to be the second-largest cryptocurrency change on the planet.

That each one unraveled shortly final month, when studies known as into query the energy of FTX’s stability sheet. Clients moved to withdraw billions of {dollars}, however FTX couldn’t meet all of the requests as a result of it apparently used its clients deposits to cowl unhealthy bets at Bankman-Fried’s funding arm, Alameda Analysis.

Bankman-Fried stated not too long ago that he didn’t “knowingly” misuse clients’ funds, and stated he believes his tens of millions of indignant clients will finally be made complete.

The Home Monetary Companies Committee will nonetheless hear testimony Tuesday from present CEO, John Ray III. Ray, who took over FTX on November 11 and is a long-time restructuring specialist, has stated in court docket filings that the monetary circumstances at FTX had been worse than at Enron.

Bahamian authorities plan to proceed their very own investigation into Bankman-Fried.

“The Bahamas and the USA have a shared curiosity in holding accountable all people related to FTX who could have betrayed the general public belief and damaged the legislation,” stated Bahamian Prime Minister Philip Davis, in a press release.

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