TechDigits

Tech news
Monday, Jan 30, 2023

Sam Bankman-Fried: Arrested crypto boss hugs parents as he is denied bail over 'one of biggest financial frauds in US history'

Sam Bankman-Fried: Arrested crypto boss hugs parents as he is denied bail over 'one of biggest financial frauds in US history'

The 30-year-old founder of FTX is being held on criminal charges over an alleged "brazen, multi-year" mass financial fraud, and faces up to 115 years in jail if convicted.

Former cryptocurrency exchange boss Sam Bankman-Fried hugged his parents after being denied bail on charges relating to "one of the biggest financial frauds in American history".

The 30-year-old founder of FTX, has been charged by the US Securities and Exchange Commission (SEC) with fraud and violating campaign finance laws. He is also being sued.

Following his arrest in the Bahamas, a judge denied him bail, saying he was a "great" flight risk, and sent him to a local correctional facility instead.

Bankman-Fried will remain in custody in the Bahamas until at least 8 February.

The latest developments cap a stunning fall from grace in recent weeks for the man known as SBF, who amassed a fortune valued over $20bn (£16.2bn) as he rode a cryptocurrency boom to build FTX into one of the world's largest exchanges before it abruptly collapsed this year.

Bankman-Fried has previously apologised to customers and acknowledged oversight failings at FTX, but said he does not personally think he has any criminal liability.

Earlier on Tuesday, US Attorney Damian Williams in New York alleged Bankman-Fried had made illegal campaign contributions to Democrats and Republicans with "stolen customer money," labelling it part of one of the "biggest financial frauds in American history".

Bankman-Fried faces a maximum sentence of 115 years in prison if convicted on all eight counts, prosecutors said.

He was arrested at his home in a gated community in the Bahamas capital, Nassau.

In the indictment unsealed on Tuesday morning, US prosecutors claimed Bankman-Fried had engaged in a scheme to defraud FTX's customers by misappropriating their deposits to pay for expenses and debts and to make investments on behalf of his crypto hedge fund, Alameda Research LLC.

He also defrauded lenders to Alameda by providing false and misleading information about the hedge fund's condition, and sought to disguise the money he had earned from committing wire fraud, it is alleged.



Both the SEC and the Commodity Futures Trading Commission (CFTC) alleged Mr Bankman-Fried committed fraud in lawsuits filed on Tuesday.

The CFTC sued him, Alameda and FTX, alleging fraud involving digital commodity assets.

Since at least May 2019, FTX raised more than $1.8bn from equity investors in a years-long "brazen, multi-year scheme" in which Bankman-Fried concealed FTX was diverting customer funds to Alameda Research, the SEC alleged.

Bankman-Fried, who founded FTX in 2019, was an unconventional figure who sported wild hair, t-shirts and shorts on panel appearances with statesmen like former American President Bill Clinton.

He became one of the largest Democratic donors, contributing $5.2m (£4.2m) to President Joe Biden's 2020 campaign.

Forbes pegged his net worth a year ago at $26.5bn (£21.4bn).

FTX filed for bankruptcy on 11 November, leaving an estimated one million customers and other investors facing losses in the billions of dollars. SBF resigned as chief executive the same day.

The collapse reverberated across the crypto world and sent bitcoin and other digital assets plummeting.

John Ray, Bankman-Fried's successor as CEO, was called to testify before the House Financial Services Committee in the US Congress on Tuesday.

A crypto exchange is a platform on which investors can trade digital tokens such as bitcoin.

Newsletter

Related Articles

TechDigits
Close
0:00
0:00
Almost 30% of professionals say they've tried ChatGPT at work
Interpol seeks woman who ran elaborate exam cheating scam in Singapore
What is ChatGPT?
Tesla reported record profits and record revenues for 2022
Microsoft is finalising plans to become the latest technology giant to reduce its workforce during a global economic slowdown
Tesla slashes prices globally by as much as 20 percent
After Failing To Pay Office Rent, Twitter May Sell User Names
FTX fraud investigators are digging deeper into Sam Bankman-Fried's inner circle – and reportedly have ex-engineer Nishad Singh in their sights
TikTok CEO Plans to Meet European Union Regulators
U.S. Moves to Seize Robinhood Shares, Silvergate Accounts Tied to FTX
Coinbase to Pay $100 Million in Settlement With New York Regulator
FTX assets worth $3.5bn held by Bahamas securities regulator
Former FTX CEO Bankman-Fried finally arrested in Bahamas after U.S. files charges
Corruption works: House Financial Services Chair Waters doesn't plan to subpoena her donor, Sam Bankman-Fried, to testify at hearing on FTX collapse
Yellen hints at ‘national security’ probe into Twitter purchase
Elon Musk reinstates Donald Trump's Twitter account.
George W. Bush and Barack Obama will hold back-to-back disinformation conferences
Solar + Powerwall ensures you never lose power, even if the grid goes down
This man paid for strangers' grocery and it moved them to tears
Meta introduces a new version of Mark Zuckerberg
Virtual Reality on billboards: BMW advertisement on Times Square
Apple CEO Tim Cook says coding should be taught as early as elementary school: 'It's the most important language you can learn'
Apple Executive Resigns After Viral TikTok Shows Him Making Crude Jokes
Huawei is not only better technology, but also protecting users better: Apple Warns Of Security Flaw For Iphones, Ipads And Macs
Mark Zuckerberg warns many teams will ‘shrink’ as Meta revenue drops
Elon Musk reportedly begged for forgiveness after his affair with Google co-founder Sergey Brin's wife
J.P. Morgan’s wealth management guru has some advice for recent college graduates on managing money and building wealth
Pentagon widens scope of UFO-hunting unit
Bezos' girlfriend Lauren Sanchez gives $1M to group focused on migrant kids at US-Mexico border
Hong Kong gets its first metaverse churches with avatars and virtual preachers
The ‘Dirty Quid Pro Quo’ Between Democrats and Big Tech
Elon Musk swore in March not to sell any Bitcoin, but Tesla cashed out 75% of its Bitcoin holdings amid the crypto winter just months later
Crypto winter continues at Gemini as another round of layoffs hits Winklevoss crypto exchange
Ex-CIA engineer Joshua Schulte convicted over massive data leak
EU to build new top-secret bunker
Elon Musk fathered twins with one of his executives last year
Apple launches Lockdown Mode to block spyware attacks on at-risk users
Australia floods worsen as thousands more Sydney residents evacuate
Women's own body dissatisfaction appears to influence their judgment of other women's body sizes
Hacker claims to have obtained data on 1 billion Chinese citizens
British Army's Twitter and YouTube accounts restored after hack
Google will delete location history for visits to abortion clinics after overturning of Roe v. Wade
Elon Musk, Jeff Bezos, Other Top Billionaires Lose $1.4 Trillion In Worst Half Ever
Philippines orders critical news site to shut down
Social media companies could be sued for addicting children to their digital-drug in California 
Airport chaos: European travel runs into pandemic cutbacks
The teen who tracks Elon Musk's jet agreed to stop monitoring Mark Cuban's flights on Twitter after the billionaire offered business advice
YouTube Shorts Claims 1.5 Billion Global Users As TikTok Rivalry Heats Up
The “Chinese (much better) Tesla”, Nio Stock, Jumps Again As Nio Eyes 'Product Supercycle'
The Crypto Bear Market Could Last Two Years, Top Investors Say
×