FTX founder 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 (local time) in his residential complex outside the capital Nassau. Reason are violations of a financial nature against laws of the United States and the Bahamas. Bankman-Fried is scheduled to appear in court in Nassau on Tuesday.
U.S. authorities confirmed the arrest: “Tonight, Bahamian authorities arrested Samuel Bankman-Fried at the request of the U.S. government, based on a sealed indictment filed by the U.S. Attorney for the Southern District of New York,” prosecutor Damian Williams announced on Monday evening. “We expect to apply for the unseal of the indictment tomorrow morning.” Then you will be able to say more about the situation.
Bahamian media quoted a statement from the Caribbean state’s attorney general, Ryan Pinder. Accordingly, Bankman-Fried’s arrest was preceded by a notification from the United States: The United States had filed criminal charges against him. According to Pinder, the Bahamas would comply with a probable extradition request from the US “immediately” once the indictment has been published and a formal request has been made.
FTX – one of the largest trading centers 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.
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.
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 failed completely,” 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.
