Sam Bankman-Fried, founder of FTX, arrested in Bahamas

Sam Bankman-Fried, the founder and former CEO of FTX, was detained in the Bahamas and the US government was notified. Bankman-Fried was in serious difficulty after his cryptocurrency company failed.

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According to the U.S. attorney’s office in New York, Sam Bankman-Fried, the former CEO of the defunct cryptocurrency company FTX, was detained in the Bahamas at the behest of the American government. The collapse of FTX last month led to a criminal investigation into Bankman-Fried by American and Bahamian officials. When the company ran out of money following the cryptocurrency version of a bank run, it filed for bankruptcy on November 11.

Sam Bankman-Fried was arrested on Monday in The Bahamas after being charged criminally by US prosecutors. Bankman-Fried established and oversaw FTX until a lack of liquidity drove the Bahamas-based cryptocurrency exchange to file for bankruptcy. After getting official confirmation of the charges against Bankman-Fried, the Bahamas’ attorney general’s office said it went ahead with the arrest and added that it anticipates he will be extradited to the US. Bankman-Fried was detained in The Bahamas, according to a spokesman for the US Attorney’s office in Manhattan, who declined to speak on the specific charges.

Sam Bankman-Fried, the creator of FTX, is accused of paying 40 million dollars in bribes to Chinese officials in exchange for access to their blocked cryptocurrency assets, which are worth over a billion dollars. The founder is being charged with several offences after the cryptocurrency trading company experienced what would have been a bank run in November 2022 and promptly declared bankruptcy as a result. 

According to the federal indictment, Bankman-Fried was successful in buying off Chinese officials and was ultimately able to unlock the trading accounts of Almeda Research, a sister business of FTX, which contained cryptocurrency worth more than $1 billion. Bankman-Fried is accused of violating the Foreign Corrupt Business Practices Act, a federal law that makes it illegal for companies to pay bribes in order to conduct business abroad.

There are presently 13 criminal courts investigating Sam Bankman-Fried. The prior accusations include things like running an unlicensed money-transfer business, campaign finance violations, money laundering, and securities fraud. 

Sam Bankman-Fried and Gary Wang established the cryptocurrency exchange and trading network known as FTX (short for Future Exchange) in 2019. Bankman-Fried founded Alameda Research in 2017, which serves as a cryptocurrency selling company. According to rumours in November 2022, FTX was funding Alameda Research, the company’s sister division. The largest cryptocurrency exchange in the world, Binance, subsequently sold its $580 million stake in FTX, which prompted investors to hurry to withdraw their funds. The company ultimately filed for bankruptcy because it was unable to get financial support.

In one of the most publicised cryptocurrency meltdowns, FTX, one of the biggest cryptocurrency exchanges in the world, applied for bankruptcy protection on November 11 after users withdrew $6 billion (€5.7 billion) in three days. The day before FTX filed for insolvency, Bankman-Fried announced his resignation as CEO of the company. Bankman-Fried acknowledged risk management failures in a succession of interviews and outings in late November and early December, but insisted he did not engage in fraud while running the business. The collapse of FTX was the newest upheaval for the cryptocurrency market this year. A string of meltdowns that have brought down other significant players like Voyager Digital and Celsius Network have caused the general cryptocurrency market to decline.

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