The founder of the bankrupt crypto exchange FTX, Sam Bankman-Fried, has been arrested in the Bahamas. US prosecutors have filed several criminal charges against him. The US is likely to request his extradition soon.
“The Bahamas and the United States have a shared interest in holding to account all individuals associated with FTX who may have violated public trust and violated the law,” said Prime Minister Philip Davis. the Bahamas.
A spokesman for the US public prosecutor in New York confirmed to Reuters the arrest of Bankman-Fried, but declined to indicate any suspicions against him. According to him, they will probably be announced on Tuesday.
The American justice department previously announced that it is investigating whether the 30-year-old entrepreneur has committed fraud. Prosecutors are focusing on transferring money to the Bahamas around the time of filing for bankruptcy protection, insiders previously told Bloomberg news agency.
Possible fraud
FTX went bankrupt because the company did not have enough money to pay back users’ credits. This was partly because $ 10 billion in customer assets were secretly transferred from FTX to investment fund Alameda, which also belonged to Bankman-Fried. There it got stuck in investments. Fraud may have been committed. Much of that money has since disappeared.
There is also potential market manipulation. Bankman-Fried is said to have made several purchases and sales that led to the downfall of the TerraUSD cryptocurrency and the companies involved.
The FTX founder denies that he committed fraud. In an interview with The New York Times, he stated that his company has fallen short on risk management. According to him, however, there was no ‘secret transfer’. The founder thinks someone misinterpreted “the complicated internal designations.”
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