Former FTX CEO Sam Bankman-Fried Arrested
The founder and disgraced CEO of the failed crypto exchange FTX, Sam Bankman-Fried, was arrested on Monday after the US Government filed a criminal indictment.
These charges follow weeks of speculation that the FTX CEO misused customer funds.
FTX CEO arrested
Sam Bankman-Fried, popularly known as SBF, was arrested by the Royal Bahamas Police Force. The police said that the arrest was initiated following receipt of formal notification from the US Government that it filed criminal charges and is likely to request that SBF be extradited.
In a statement, the Bahamas Police confirmed that Bankman-Fried was taken into custody without a hitch at his Albany apartment complex at 6pm.
SBF's arrest resulted from financial offences alleged in the US which would also be offenses in the Bahamas, the statement said.
A sealed indictment filed by the Southern District of New York was the basis for the arrest. US Attorney Damian Williams confirmed this in a tweet.
Last month, the exchange filed for bankruptcy in the US after it imploded almost overnight, leaving customers unable to access their funds. According to court filings, FTX owed its largest creditors around $3.1 billion.
The dramatic fall from grace has been the talk of the market. The exchange's CEO was expected to testify about the company's collapse in Congress on Tuesday.
Bankman-Fried future looks clouded
According to the New York Times, the charges filed against Bankman-Fried include wire fraud, wire fraud conspiracy, securities fraud, security fraud conspiracy, and money laundering.
However, it's still unclear whether customers will be able to recover some, if not all, of their funds. A 2 November report on ties between FTX and Alameda, a trading company also controlled by the FTX CEO, exposed that Alameda's balance sheet was overexposed to FTT currency (FTX's token).
According to the extradition treaty between the US and the Bahamas, defendants may be returned to the US provided their offenses carry a minimum one-year sentence in both countries.
The 30-year-old has recently disregarded legal counsel and increased his public appearances, providing his version of his company's abrupt failure and typically portraying himself as an inept CEO.
"I didn't knowingly commit fraud," he said during a BBC at the weekend. SBF told the interviewer he didn't want any of this to happen and added that he was "not nearly as competent" as he believed himself to be.
Author: Ibrahim Anifowoshe
Ibrahim is a writer with extensive experience writing about the crypto industry. He has reported widely and written educational content on the space.