FTX's Bankman-Fried transported from Bahamas to NY to be prosecuted
This comes weeks following the bankruptcy of FTX and sister trading house Alameda Research, whereby SBF was said to have cheated investors and exploited funds.
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Sam Bankman-Fried detained in the Bahamas (AP)
FTX founder Sam Bankman-Fried is now in US custody and will be flown from the Bahamas to the state of New York on Wednesday, where two associates of his have already pled guilty to charges concerning the FTX company collapse, which is headquartered in the Bahamas.
Bankman-Fried waived his right to appeal an extradition request, according to the Bahamas attorney general. He was charged last week with conspiracy, wire fraud, money laundering, and election finance violations.
This comes weeks following the bankruptcy of FTX and sister trading house Alameda Research, whereby Bankman-Fried was said to have cheated investors in FTX, and exploited funds of FTX and Alameda Research. He "was orchestrating a massive, years-long fraud, diverting billions of dollars of the trading platform's customer funds for his own personal benefit and to help grow his crypto empire," stated US prosecutors.
"I'm really sorry, again, that we ended up here. Hopefully, things can find a way to recover," said Bankman-Fried, on his Twitter account last month. "I was shocked to see things unravel the way they did."
2) I'm really sorry, again, that we ended up here.
— SBF (@SBF_FTX) November 11, 2022
Hopefully things can find a way to recover. Hopefully this can bring some amount of transparency, trust, and governance to them.
Ultimately hopefully it can be better for customers.
$8 billion misappropriated
Out of the eight charges, five of them hold a maximum prison sentence of 20 years - each. Bankman-Fried was one of the stars of the crypto field, drawing comparisons to investment magnate Warren Buffett.
The former FTX CEO tried to organize a bailout but failed - this left FTX struggling to raise billions of dollars and many customers unable to retain their money.
US attorney Damian Williams, who happens to be the federal prosecutor, confirmed the names of the two FTX associates: Alameda Research CEO Caroline Ellison and FTX co-founder Gary Wang, whose charges were "in connection with their roles in the frauds that contributed to FTX's collapse,"
Read next: Crypto media The Block secretly paid millions by FTX's Bankman-Fried
Civil lawsuits were filed against the two associates by the SEC and Commodity Future Trading Commission (CFTC), who are said to be cooperating with authorities, making their sentences a bit more lenient than Bankman-Fried's.
An estimate by the CFTC exhibits that $8 billion in funds were misused from FTX client accounts.
Bankman-Fried has spent the past nine days in the Bahamas' Fox Hill prison, and per US media, and his lawyers have been trying to negotiate terms to release him on bail with US justice authorities.
