Key takeaways:
- Authorities in The Bahamas arrested Sam Bankman-Fried on Monday
- The arrest follows an indictment shared with the Bahamian authorities by U.S. prosecutors
- SBF is expected to be extradited to the U.S., where he will face wire fraud, security fraud conspiracy, and money laundering charges
The Bahamas are expected to extradite SBF to the U.S. upon request
About a month after the collapse of the second largest crypto exchange, the Bahamian authorities arrested FTX founder Sam Bankman-Fried on Monday. The arrest followed U.S. Attorney Damian Williams’ sharing of a sealed indictment with the Bahamian officials.
According to a report by CNBC, Bankman-Fried is looking at wire fraud, security fraud conspiracy, and money laundering charges.
In addition to the indictment filed by the U.S. Attorney for the Southern District of New York, the Securities and Exchange Commission (SEC) has also filed a complaint against the founder of FTX. The SEC is accusing Bankman-Fried if defrauding equity investors that were involved with FTX.
Recall that FTX was valued at $32 billion following the $400 million Series C funding round in January. Around that same time, the exchange’s U.S. arm, FTX US, also raised $400 million, albeit at an “only” $8 billion valuation.
Last month, the FTX exchange filed for bankruptcy, after a massive bank run forced the exchange to admit to insolvency. Soon after, it came to light that the reason for FTX’s poor financials was that the exchange funneled user funds, which were supposed to be completely inaccessible, to Alameda Research, Bankman-Fried’s investment company that made a series of poor trades during this year’s crypto downturn.
The Bahamas are expected to extradite Bankman-Fried to the U.S. upon request by United States officials. Speaking about the arrest, Bahamian Prime Minister Philip Davis noted:
“The Bahamas and the United States have a shared interest in holding accountable all individuals associated with FTX who may have betrayed the public trust and broken the law.”
