Sam Bankman-Fried, the founder and former CEO of collapsed cryptocurrency exchange FTX, has been arrested in the Bahamas at the request of U.S. authorities. Late Tuesday evening, a judge there deemed him a flight risk and denied bail.
Officials in both the U.S. and the Bahamas confirmed Monday that Bankman-Fried (commonly known by his initials, SBF) had been taken into custody. So far, it’s unclear exactly what charges have been leveled against the disgraced tech executive. A sealed indictment related to the case will be unsealed tomorrow in the Southern District of New York, officials said.
“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,” said Damian Williams, U.S. attorney for the Southern District of New York, in a statement shared on Twitter Monday. “We expect to move to unseal the indictment in the morning and will have more to say at that time.”
Despite the government’s tight-lipped approach to the case, the New York Times seems to have gotten the details, reporting that SBF is facing a gamut of financial crimes, including securities fraud, securities fraud conspiracy, wire fraud, wire fraud conspiracy, and money laundering.
The Bahamian government confirmed Monday that Bankman-Fried’s arrest “followed receipt of formal notification from the United States that it has filed criminal charges against SBF and is likely to request his extradition.” Authorities also commented that after extraditing SBF to the states, the local government planned to continue its own criminal investigation into FTX’s activities. FTX formerly headquartered its business in the Bahamas, and the nation’s law enforcement has already been looking into the case.
“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 cooperation of its law enforcement and regulatory partners in the United States and elsewhere,” said Prime Minister of the Bahamas, Philip Davis, in a statement.
FTX, which was once the shining star of the cryptocurrency industry, imploded last month in an orgy of financial malfeasance that sent shockwaves throughout the web3 world. After admitting to mismanaging customer assets, SBF stepped down from his leadership role and FTX filed for bankruptcy, sending other companies that were financially connected to the exchange into a tailspin.
An initial perusal of the company’s finances by the company’s new CEO appears to show rampant financial mismanagement. Additionally, billions of dollars in customer funds are still missing and no one seems to know where they are.
Still, after presiding over one of the most spectacular corporate meltdowns in modern history, Bankman-Fried somehow managed to remain a free man for what many deemed an unnaturally long period of time. For weeks, commentators have wondered when—or even if—the disgraced tech executive would face legal repercussions for the financial mess his company caused. Instead of being placed under arrest, however, the boyish tech tycoon spent the last several weeks engaged in a media-wooing “publicity tour”—giving interviews to major news networks, including ABC and the New York Times.
Now, it would appear that tour has officially come to an end. Bankman-Fried seems to be in quite a lot of trouble, though we’ll have to wait to see just how much.