The US Attorney’s Office, Southern District New York, has unsealed the criminal charges filed against Sam Bankman-Fried and his firms including FTX. The criminal charges were revealed yesterday when the Bahamas announced it expected to extradite Bankman-Fried following a formal request.
The indictment states that from at least or about 2019 until last month (November 2022) when FTX filed for bankruptcy, the defendant and others have willfully conspired to commit fraud.
The eight charges include the following:
- Conspiracy to commit wire fraud
- Wire fraud on customers
- Conspiracy to commit fraud on lenders
- Wire fraud on lenders
- Conspiracy to commit commodities fraud
- Conspiracy to commit securities fraud
- Conspiracy to commit money laundering
- Conspiracy to defraud the US and violate the campaign finance laws
While Bankman-Fried had been on a public relations tour up until his arrest yesterday, as the details emerge, it becomes clearer that endemic fraud has been occurring at FTX for many months. New FTX CEO John J. Ray, III, has testified there were virtually no controls and no accounting taking place at FTX. At the same time, FTX and hedge fund Alameda Research effectively operated as a single entity, comingling funds. All of the FTX-related firms were controlled by Sam Bankman-Fried.
Several observers believe that the speed of criminal charges indicates an FTX insider may have cut a deal, thus providing keen insight into the operations of FTX.
