Sam Bankman-Fried Arrested in Bahamas

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Sam Bankman-Fried, the founder of FTX, was detained by Bahamian authorities on Monday night (Dec 12 2022) after the Southern District of New York's US Attorney shared a sealed formal accusation with them, paving the way for his extradition and eventual trial in the US. He was the driving force behind the collapse of the crypto exchange. 

Bankman-Fried was scheduled to virtually testify before the House Financial Services Committee on Tuesday before it was known that he had been arrested, but his attorneys told media sources that he will not speak. 

His arrest marks the authorities' first significant step toward holding those accountable for the multibillion-dollar collapse of FTX last month. 

U.S. Attorney Damian Williams for the Southern District of New York stated that the government would "unseal the indictment in the morning." The allegations include money laundering, securities fraud, wire fraud, and conspiracy to commit securities fraud. 

Ryan Pinder, the Bahamas' attorney general also stated that the United States "is expected to request his extradition."

The Bahamas and the United States have a common interest in holding accountable all people connected to FTX who may have breached the public trust and broken the law, according to a statement from Bahamian Prime Minister Philip Davis. 

The statement continued, "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, while the United States is pursuing criminal charges against SBF individually.  The fact that Bahamas law enforcement detained Bankman-Fried and anticipate extraditing him indicates that the Bahamas and the United States will work closely together as the bankruptcy process progresses. 

Since the early 20th century, when the Bahamas were still governed by the British, the United States and the Bahamas have had an extradition agreement in effect. The seeking party must present an arrest warrant that has been issued by a judge or "other competent authority," according to the current treaty, which was signed in 1990. 

Bankman-Fried left his position as CEO and FTX and its affiliates declared bankruptcy in November. A run-on asset resembling a bank run led to the stunning implosion of the cryptocurrency trading company.

Attorneys for FTX and Bahamian authorities had been fighting bloody battles in court and in the court of public opinion. Earlier on Monday, FTX lawyers claimed that Bankman-Fried and the Bahamian government were conspiring to steal corporate assets from FTX and place them in cryptocurrency wallets under the supervision of Bahamian officials.