Sam Bankman-Fried, the former CEO of FTX Exchange, has been charged by the SEC with defrauding American clients and concealing the misappropriation of client assets.
The former CEO of the now-bankrupt cryptocurrency exchange FTX, Sam Bankman-Fried, has been charged by the United States Securities and Exchange Commission (SEC).
The Securities Act of 1933 and the Securities Exchange Act of 1934 contain anti-fraud laws, which Bankman-Fried is accused of breaking by the SEC. The SEC’s action asks for injunctions to prevent further violations of the securities laws, which forbid Bankman-Fried from taking part in the issuance, purchase, offer, or sale of any securities other than for his own benefit.
Bankman-Fried was charged by the SEC for planning a scheme to defraud equity investors in FTX Trading Ltd. (FTX). According to the regulatory agency, the former CEO misled investors about his “diversion of FTX clients’ cash to crypto trading firm Alameda Research while obtaining more than $1.8 billion from investors.”
Sam Bankman-Fried is accused of constructing a house of cards on a false foundation while assuring investors that it was one of the safest structures in cryptocurrency, according to SEC Chair Gary Gensler.
The former CEO has only been detained by Bahamian officials at the request of American authorities for one day when new charges are brought against him.
The SEC declared they were getting ready to file charges against the co-founder of FTX; only a few hours after Bankman-Fried was detained; these accusations will be distinct from the ones that led to his most recent detention in the Bahamas.