Cryptocurrency Firm FTX Founder Sam Bankman-Fried Arrested in Bahamas Over Sealed Criminal Charges

Cryptocurrency Firm FTX Founder Sam Bankman-Fried Arrested in Bahamas Over Sealed Criminal Charges
Cryptocurrency firm FTX founder Sam Bankman-Fried was arrested in the Bahamas over criminal charges at the request of the United States government. Photo by Alex Wong/Getty Images

Sam Bankman-Fried, the founder of cryptocurrency firm FTX, was arrested in the Bahamas after the United States government filed criminal charges that are expected to be unsealed on Tuesday.

The announcement of the arrest was made by U.S. and Bahamian authorities on Monday at the behest of the American government. Following last month's collapse of FTX, Bankman-Fried has been under criminal investigation by U.S. and Bahamian authorities.

Sam Bankman-Fried's Arrest

On Nov. 11, the firm filed for bankruptcy when it ran out of funds after the cryptocurrency equivalent of a bank run. U.S. Attorney Damian Williams said that they expect to unseal the indictment against Bankman-Fried in the morning and provide more details at that time.

In a statement, Bahamian Attorney General Ryan Pinder said that the Bahamas would "promptly" extradite Bankman-Fried to the U.S. after the indictment is unsealed and the U.S. government makes a formal request.

The arrest comes as FTX's headquarters is located in the Bahamas and the cryptocurrency firm founder has largely remained in his luxury compound in Nassau since the failure of his company, as per the Associated Press.

A spokesman for the defendant had no comment regarding the situation on Monday evening but Bankman-Fried has a right to contest his extradition to the U.S. This could delay but most likely not prevent his transfer to the United States.

Furthermore, Bankman-Fried's arrest comes a day before he was scheduled to testify in front of the House Financial Services Committee. In a statement, Rep. Maxine Waters, who is the chairwoman of the committee, said she was "disappointed" that the American public along with FTX's customers would not get to see the cryptocurrency firm founder testify under oath.

According to Yahoo Finance, in a statement, Bahamas Prime Minister Philip Davis said that they and the United States have a shared interest in holding accountable all individuals associated with FYX who may have betrayed the public trust and the rule of law.

FTX Fraud Charges

Davis added that while the U.S. government was pursuing its own criminal charges against Bankman-Fried, the Bahamas will continue its own probe into the collapse of the cryptocurrency firm with assistance from law enforcement and regulatory partners in the U.S. and elsewhere.

A U.S. Attorney's Office, Southern District of New York spokesman declined to comment further on the criminal investigation into Bankman-Fried's case. On the other hand, the U.S. Securities and Exchange Commission has authorized charges related to Bankman-Fried's violation of securities laws that are set to be unsealed tomorrow.

Other criminal charges against Bankman-Fried include wire fraud, wire fraud conspiracy, securities fraud, securities fraud conspiracy, and money laundering. A person with knowledge of the matter said that the defendant was arrested shortly after 6:00 p.m. at his apartment complex in the Albany resort in the Bahamas.

Bankman-Fried was allegedly cooperative during his arrest and was set to be held overnight in a cell at a police station. He will later appear on Tuesday in Magistrate Court in Nassau, the capital of the Bahamas, the New York Times reported.

Tags
Bahamas, Criminal charges
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