Former crypto billionaire and FTX founder Sam Bankman-Fried has been arrested in the Bahamas after U.S. authorities filed criminal charges against him.
General Ryan Pinder of the Bahamian authorities told NBC News that Bankman-Fried had been arrested following “unspecified criminal charges” from U.S. authorities, who will likely “request his extradition.” Bahamas Prime Minister Philip Davis said in a statement that his government has a shared interest with the United States in bringing the FTX founder to justice.
“The Bahamas and the United States have a shared interest in holding accountable all individuals associated with FTX who may have betrayed the public trust and broken the law,” the prime minister said. “While the United States is pursuing criminal charges against SBF individually, The Bahamas will continue its own regulatory and criminal investigations into the collapse of FTX, with the continued cooperation of its law enforcement and regulatory partners in the United States and elsewhere.”
The arrest came as Bankman-Fried was set to testify before the House Financial Services Committee on Tuesday. Per NBC News:
His arrest is the first concrete move by regulators to hold individuals accountable for the multi-billion dollar implosion of FTX last month.
Last month, FTX and its affiliates filed for bankruptcy and Bankman-Fried stepped down from his role as CEO. The crypto trading firm imploded in spectacular fashion following a run on assets similar to a bank run.
John J. Ray III replaced Bankman-Fried as CEO of FTX and will testify before Congress this week. In his prepared remarks he released ahead of his testimony, Ray said he has never seen “such an utter failure of corporate controls at every level of an organization, from the lack of financial statements to a complete failure of any internal controls or governance whatsoever.”
“Although our investigation is ongoing and detailed findings will have to await its conclusion, the FTX Group’s collapse appears to stem from the absolute concentration of control in the hands of a very small group of grossly inexperienced and unsophisticated individuals who failed to implement virtually any of the systems or controls that are necessary for a company that is entrusted with other people’s money or assets,” his remarks said.
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