FTX Ex-CEO Arrested In The Bahamas

FTX CEO Arrested: What Are The Important Events Behind It?

The former FTX CEO arrested. Sam Bankman-Fried, who led the cryptocurrency exchange has been arrested in the Bahamas. The fall of the exchange has got him into this trouble. He was scheduled to appear and testify in Congress on the 13th of December 2022 regarding the fall of the crypto exchange owing to the liquidity crunch. He was criminally charged by U.S. prosecutors.

The Bahamas attorney general’s office stated that it had proceeded with the arrest, soon after they received the formal confirmation of all the charges against him on FTX collapse. The attorney general’s office for The Bahamas also added that it expects after the former FTX CEO arrested, Sam Bankman-Fried will be extradited to the U.S.

A spokesperson from the Manhattan-based U.S. Attorney’s Office has confirmed that the former founder of FTX had been arrested in the Bahamas. Yet, the spokesperson had preferred not to comment on all the charges that were against him.

The United States prosecutor, Damian Williams, mentioned in a statement,

“Earlier this evening, Bahamian authorities arrested Samuel Bankman-Fried at the request of the U.S. Government, based on a sealed indictment filed by the United States Attorney’s Office for the Southern District of New York.”

He further mentions,

“We expect to move to unseal the indictment in the morning and will have more to say at that time.”

When requested for comment, a lawyer of the accused, Mark Cohen, did not respond immediately.

FTX was amongst the largest cryptocurrency exchanges in the world. It had filed for Chapter-11 bankruptcy protection back on the 11th of November this year. It is one of the high-profile crypto blowups that occurred after the traders had pulled out $6 billion from the platform in just three days. After this incident, the rival crypto exchange, Binance, had withdrawn a rescue deal.

The crypto exchange faced a liquidity crunch after the former FTX CEO hideously moved $10 billion of the customer finds to Alameda, as Reuters reported. Two people were familiar with the incident. The people said that an estimated $1 billion from the customer accounts had disappeared suddenly. The crypto market was also heavily negatively impacted owing to this situation and might bring even more crypto winter.

In response to this, Sam Bankman-Fried mentioned that the company did not transfer any funds secretly but misread its “confusing internal labeling.” When he was questioned about the missing funds, he was completely blank and could not respond to anything.

In an interview on the 30th of November at the New York Times’ Dealbook Summit, the accused mentioned,

“I didn’t ever try to commit fraud. I do not personally think I have any criminal liability.”

In addition to the running probe, the Securities and Exchange Commission and Commodity Futures Trading Commission (CFTC) have opened probes. Besides this, U.S. cryptocurrency investors have also sued the former founder of FTX before the FTX CEO arrested. They alleged that a couple of celebrities have promoted FTX and engaged in deceptive practices that left the investors with $11 billion in damages.

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