Sam Bankman-Fried, the former CEO of the insolvent FTX exchange has pleaded not guilty in a New York Federal Court over charges of misappropriation of customers’ funds, alleged money laundering charge, and breaking US campaign laws, amongst other charges.
Bankman-Fried signed extradition papers in December and was moved to the United States where he is now being tried for 8 counts of charges against him. A report from CNBC revealed that the former CEO is expected to begin trials on October 2nd and is expected to last for 4 weeks.
Bankman-Fried was released from prison in the Bahamas after paying a $250 million bail bond, co-signed by his parents and two other persons whose identity Bankman-Fried pleaded with the judge not to reveal. He stated that they may face harassment and threats if their identities are disclosed.
The challenges with the insolvent FTX platform were made known to the public in November when Bankman-Fried said the firm was experiencing a financial crisis and he needed capital to be injected into the business for it to continue operations.
Federal prosecutors have also announced the establishment of a team whose sole purpose is to recover the digital assets of victims, as part of their ongoing investigation into Bankman-Fried and the implosion of FTX.
Meanwhile, two former FTX executives, Caroline Ellison who was the Chief Executive Officer of Alameda Research LLC, and Gary Wang who served as FTX’s Chief Technology Officer have pleaded guilty to charges of aiding and abetting Bankman-Fried in committing fraud. They have also pledged to help federal prosecutors in the ongoing case.
SEC Seizes FTX Assets Prior to Handover to Clients
The Bahamas’ Securities & Exchange Commission (SEC) said it was keeping digital assets worth $3.5 billion belonging to the insolvent FTX before handing them over to FTX’s investors and creditors.
The report highlighted that the assets were transferred to digital wallets that can only be accessed by Bahamian regulators. This happened shortly after the company filed for bankruptcy in the United States. Following the seizure of the assets, Sam Bankman-Fried, the embattled former CEO of the insolvent FTX exchange, and his former executives no longer have access to the digital assets.
In related news, a CNBC report stated that Bahamas regulators have filed an appeal with a bankruptcy judge to try to reclaim ownership of FTX-owned properties in New Providence, Bahamas. The regulators argued that the administration of the properties in the US will be against Bahamas laws.
