Sam Bankman-Fried Arrested Immediately After Saying He Wouldn’t Be ArrestedDecember 13, 2022
Disgraced FTX founder Sam Bankman-Fried was arrested by Bahamian authorities on Monday at the request of the U.S. government on unspecified charges, a month after his crypto trading empire suddenly collapsed and went bankrupt amid widespread allegations of fraud.
“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 SDNY,” United States Attorney for the Southern District of New York Damian Williams said in a tweeted statement. “We expect to move to unseal the indictment in the morning and will have more to say at that time.”
Earlier in the day, on a live recording of the Unusual Whales podcast, Bankman-Fried said he did not believe he would be arrested.
“Are you worried you might be detained if you set foot in the US?” moderator and crypto critic Molly White asked Bankman-Fried. “I don’t believe I would be, but I haven’t done a, like, deep dive into that. At some point, that’s something I need to think harder about,” he replied.
Crypto exchange FTX and sister hedge fund Alameda Research—both founded by Bankman-Fried—suddenly imploded in early November, taking Bankman-Fried’s public image of a benevolent billionaire and responsible crypto CEO with them. The details that have emerged since then, in reports and in bankruptcy filings, is ugly: FTX reportedly funneled users’ funds to Alameda Research, which made high-risk crypto bets that went bust, leaving the exchange without the needed funds to hand people back their deposits. At least a billion dollars is missing, and the people brought in to clean up the mess say they have no confidence in the company’s internal financials as being accurate.
On top of the U.S. prosecutors’ charges and investigations by The Bahamas, Sam Bankman-Fried and FTX are facing at least five civil lawsuits accusing the company, its top executives, and its celebrity promoters of fraud. There are also ongoing probes by the SEC and the state of California that have been announced in the weeks since the company’s spectacular collapse.
In a BBC interview
Bankman-Fried has launched a PR offensive from the Bahamas, where FTX was headquartered, since the company’s collapse. Rather than disappear into the shadows, he has tweeted at length, appeared in various Twitter Spaces, and appeared remotely at the New York Times Dealbook conference. He was expected to testify at a House committee hearing on Tuesday.
In a statement, Bahamian Prime Minister Philip Davis said “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. 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.”
Gavin Butler contributed reporting.