FTX founder Bankman-Fried arrested in Bahamas after US files charges
SBF was due to testify before US Congress about the crypto exchange’s sudden crash last month, which sent shockwaves through the crypto industry.
FTX founder Sam Bankman-Fried (SBF) was arrested in the Bahamas at the direction of US authorities.
The arrest took place yesterday (12 December), the day before he was due to testify before US Congress about the crypto exchange’s sudden crash.
The crypto exchange fell into a sudden collapse last month, falling into bankruptcy and owing billions to its top 50 creditors. Bankruptcy filings suggest the exchange may have more than 1m creditors.
There were also reports that funds are missing, along with claims that SBF secretly transferred $10bn of customer funds from FTX to his trading company Alameda.
FTX was a highly successful crypto exchange, reaching a valuation of $18bn in a 2021 funding round, which saw backing from major tech investors such as SoftBank and Sequoia.
Speaking on the arrest, US Congress representative Maxine Waters said “it’s about time” that the process to bring SBF to justice has begun.
However, she raised issues with the timing of the arrest interrupting his chance to testify before Congress.
“Although Mr Bankman-Fried must be held accountable, the American public deserves to hear directly from Mr Bankman-Fried about the actions that’ve harmed over 1m people, and wiped out the hard-earned life savings of so many,” Waters said.
“The public has been waiting eagerly to get these answers under oath before Congress, and the timing of this arrest denies the public this opportunity. While I am disappointed that we will not be able to hear from Mr. Bankman-Fried tomorrow, we remain committed to getting to the bottom of what happened,” Waters added.
Separately, the US Securities and Exchange Commission said on Twitter that it had authorised separate charges relating to SBF’s “violations of securities laws”, which will soon be filed publicly in the Southern District of New York.
Some of the criminal charges against SBF include wire fraud, wire fraud conspiracy, securities fraud, securities fraud conspiracy and money laundering, a person with knowledge of the matter told the New York Times.
FTX had more than 1m users on its mobile and desktop platforms at its peak and made more than $1bn in revenue last year, according to 2022 statistics. SBF’s personal wealth also grew to more than $16bn.
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