Proactive Investors - Sam Bankman-Fried, the founder and former head of collapsed cryptocurrency exchange FTX, has been arrested on financial offences in the Bahamian capital Nassau at the request of the US government.
SBF will be held in custody "pursuant of our nation's Extradition Act", John Delaney KC, attorney general of the Bahamas said in a statement.
The US Department of Justice confirmed the arrest on Twitter.
USA Damian Williams: 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. We expect to move to unseal the indictment in the morning and will have more to say at that time.— US Attorney SDNY (@SDNYnews) December 12, 2022
"Earlier this evening, Bahamian authorities arrested Samuel Bankman-Fried at the request of the US Government, based on a sealed indictment filed by the SDNY (Southern District of New York). We expect to move to unseal the indictment in the morning and will have more to say at that time," read a statement from the US Attorney’s office.
On the arrest, Bahamas 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 operation of its law enforcement and regulatory partners in the United State and elsewhere.”
The US Securities and Exchange Commission (SEC) has filed separate charges relating to securities law violations.
Bankman-Fried has repeatedly pledged his innocence throughout the press tour that followed FTX’s collapse, but there is mounting evidence of widespread criminal activity conducted within his two companies, FTX and Alameda Research.
He is accused of funnelling billions of dollars worth of FTX customers’ funds through a ‘backdoor’ into venture fund Alameda Research in order to place risky trades with high amounts of leverage that ultimately saw the funds disappear.
With over one million out-of-pocket creditors, FTX was forced into bankruptcy proceedings in November.
According to legal experts interviewed by CNBC, SBF could be facing life in prison if the litany of charges sticks.
SBF was scheduled to appear via video link in today’s US House Committee on Financial Services hearing titled ‘Investigating the Collapse of FTX, Part I’ at the request of house representative Maxine Waters.
But as it turns out, the authorities had other plans for him.