NASSAU – Sam Bankman-Fried, the disgraced co-founder and former head of digital asset exchange FTX, was arrested in the Bahamas on Monday, after US prosecutors filed criminal charges.
“SBF’s arrest followed receipt of formal notification from the United States that it has filed criminal charges against SBF and is likely to request his extradition,” said the government of the Bahamas in a statement.
Bankman-Fried’s detention followed a notification from the US that it had filed criminal charges against him, the Bahamas Attorney-General said in a statement. The authorities in both countries had been probing Bankman-Fried’s involvement in the company’s collapse in November.
In a statement, Mr Damian Williams, US attorney for the Southern District of New York, said the arrest was made at the request of the American government.
Bankman-Fried was scheduled to testify in Congress on Tuesday about the collapse of FTX, which was one of the most powerful firms in the emerging crypto industry until it imploded virtually overnight in November after a run on deposits exposed an US$8 billion (S$10.8 billion) hole in its accounts.
Prosecutors for the Southern District of New York confirmed that Bankman-Fried had been charged and said an indictment would be unsealed on Tuesday.
Separately, the Securities and Exchange Commission said in a statement that it had authorised charges “relating to Bankman-Fried’s violations of our securities laws”.
The criminal charges against Bankman-Fried included wire fraud, wire fraud conspiracy, securities fraud, securities fraud conspiracy and money laundering, said a person with knowledge of the matter.
Bankman-Fried, who was the only person charged in the indictment, was taken into custody by the Bahamian authorities, the person said.
He was arrested shortly after 6pm at his apartment complex in the Albany resort in the Bahamas, according to a statement from Bahamian police. The timing of when he might be moved to the US was unclear.
Bankman-Fried was cooperative during the arrest, according to a person familiar with the matter, and will be held overnight in a cell at a police station.
He is scheduled to appear on Tuesday in a magistrate court in Nassau, the capital of the Bahamas.
A spokesman for Bankman-Fried declined to comment. Mr Nicholas Biase, a spokesman for the US Attorney’s Office, also declined to comment.
More than 100 FTX-related entities filed for US bankruptcy protections on Nov 11. The company and Bankman-Fried are facing investigations in the US and the Bahamas, where the company was headquartered, into a range of possible misconduct. One key inquiry is into whether customer funds were lent out to trading firm Alameda Research, which he had also founded.
In media interviews since FTX’s collapse, Bankman-Fried has admitted to major managerial missteps, but has also claimed that he never tried to commit fraud or break the law.
In his remarks prepared for a US House hearing that he was scheduled to appear at on Tuesday, Bankman-Fried offered a blunt assessment of his plight.
“I would like to start by formally stating under oath: I f*cked up,” he said in the remarks obtained by Bloomberg News. BLOOMBERG