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    Bankman-Fried extradited to US to face fraud charges over FTX collapse

    NEW YORK (AFP) – FTX co-founder Sam Bankman-Fried arrived in the United States (US) from the Bahamas in FBI custody on Wednesday, US media reported, facing criminal fraud charges after the spectacular collapse of the crypto exchange.

    FTX and its sister trading house Alameda Research went bankrupt last month, dissolving a virtual trading business that had been valued by the market at USD32 billion.

    Prosecutors allege Bankman-Fried cheated investors and misused funds that belonged to FTX and Alameda Research customers.

    US Attorney Damian Williams announced on Wednesday the 30-year-old would be “transported directly to the Southern District of New York” on arrival in the US.

    The plane carrying Bankman-Fried arrived on Wednesday night, US media reported.

    Earlier in the Bahamas – where FTX is headquartered – he had waived his right to challenge the US extradition request, the island nation’s attorney general said.

    US prosecutors last week charged Bankman-Fried with conspiracy, wire fraud, money laundering and election finance violations.

    He “was orchestrating a massive, years-long fraud, diverting billions of dollars of the trading platform’s customer funds for his own personal benefit and to help grow his crypto empire”, they said.

    FTX founder Sam Bankman-Fried, is escorted into the Magistrates’ Court building from a Corrections Department van in Nassau, Bahamas. PHOTO: AP

    Five of the eight counts against Bankman-Fried carry a maximum sentence of 20 years in prison each.

    The SEC separately accused him of violating securities laws.

    US Attorney Williams said two key figures in the case – Alameda Research CEO Caroline Ellison and FTX co-founder Gary Wang – had pleaded guilty to charges related to the FTX collapse and that they were cooperating with authorities.

    Their charges were “in connection with their roles in the frauds that contributed to FTX’s collapse”, he said, but did not provide further details. Williams’ office did not respond to an AFP request for comment on the charges.

    Separately, the SEC and the Commodity Future Trading Commission (CFTC) announced on Wednesday they had filed civil suits against Ellison and Wang and that the two were cooperating, which should lead to a more lenient judgement.

    The CFTC estimates that USD8 billion in funds were misappropriated from FTX customer accounts.

    After its founding in 2019, FTX rose spectacularly to become a leading player in the crypto world.

    Bankman-Fried appeared on the covers of finance and tech magazines, and drew in huge investments from prominent fund managers and venture capitalists. He was also lionised in the halls of politics, becoming a spokesman for the industry on regulatory issues in Washington, and contributing tens of millions of dollars to the Republicans and the Democrats.

    But it all imploded dramatically in November when a media report said Alameda’s balance sheet was heavily built on a token created by FTX with no independent value – and exposed Bankman-Fried’s companies as being dangerously interlinked.

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