More Charges For Sam Bankman Fried

 

TL;DR:

• Sam Bankman-Fried, the former CEO and founder of FTX, is facing a total of 13 criminal charges, including an additional bribery charge related to the collapse of the cryptocurrency exchange.
• Prosecutors allege that Bankman-Fried directed $40 million in cryptocurrencies to Chinese government officials to unfreeze accounts owned by FTX’s sister trading firm Alameda Research, and spent months trying to access the funds before turning to bribery.
• Bankman-Fried’s legal troubles could have wider implications for the cryptocurrency industry, highlighting the need for greater oversight and accountability. The case could prompt other cryptocurrency exchanges and trading firms to review their compliance policies and procedures to avoid similar legal troubles.

Sam Bankman-Fried, the former CEO and founder of FTX, has been hit with an additional bribery charge in connection with the collapse of the cryptocurrency exchange. Bankman-Fried is now facing a total of 13 criminal charges, including wire fraud, securities fraud, conspiracy to commit bank fraud, and defrauding the Federal Election Commission.

According to the superseding indictment unsealed on March 28, prosecutors allege that Bankman-Fried directed $40 million in cryptocurrencies to one or more Chinese government officials to influence them to unfreeze accounts owned by FTX’s sister trading firm Alameda Research. The funds were allegedly frozen as part of an investigation into a particular Alameda trading counterparty, but the indictment doesn’t name the exchanges or the firm that was being investigated.

Prosecutors allege that Bankman-Fried spent months trying to access the funds before turning to bribery. He allegedly hired attorneys to lobby the government, asked the exchanges to unfreeze the funds, and opened new trading accounts under false names. In November 2021, Bankman-Fried caused a bribery payment of cryptocurrency worth approximately $40 million to be transferred from Alameda’s main trading account to a private cryptocurrency wallet. Around the same time, Alameda’s crypto exchange accounts were unfrozen, and the trading firm sent tens of millions more worth of crypto assets to complete the bribe.

Bankman-Fried’s lawyer, Mark. S. Cohen, did not immediately respond to Decrypt’s request for comment. The charges related to the Federal Election Commission allege that Bankman-Fried and others defrauded the United States by impairing, obstructing, and defeating the lawful functions of a department and agency of the United States through deceitful and dishonest means.

Today’s superseding indictment comes just a month after prosecutors hit Bankman-Fried with four additional charges following the former CEO’s arrest in December last year.

The collapse of FTX was a dramatic event that shook the cryptocurrency industry. FTX filed for Chapter 11 bankruptcy in November 2022, and its sister entity, algorithmic trading firm Alameda Research, its American subsidiary FTX.US, and roughly 130 affiliated entities also filed for bankruptcy.

Bankman-Fried’s legal troubles could have wider implications for the cryptocurrency industry, as it highlights the risks and challenges of operating in a relatively unregulated market. The allegations against Bankman-Fried could damage the reputation of FTX and the wider cryptocurrency industry, and further regulatory scrutiny and legal action could follow.

The cryptocurrency industry has long been criticized for its lack of regulation and transparency, and the charges against Bankman-Fried underscore the need for greater oversight and accountability. The case could also prompt other cryptocurrency exchanges and trading firms to review their compliance policies and procedures to avoid similar legal troubles.

As the cryptocurrency industry continues to grow and evolve, it will be important for companies to prioritize compliance and transparency to build trust with regulators, investors, and customers. The charges against Bankman-Fried are a reminder that the cryptocurrency industry is not immune to the legal and regulatory challenges faced by traditional financial institutions, and that those who flout the law will be held accountable.