FTX cryptocurrency exchange founder and former CEO Sam Bankman-Fried, also known as “SBF,” is facing a new 13-count indictment from authorities in the United States.
Among the charges, SBF is accused of bribing a Chinese government official with $40 million to unfreeze cryptocurrency accounts at FTX’s affiliate firm, Alameda Research.
According to a court filing by United States attorney Damian Williams, the complaint alleges that SBF and other related parties “directed and caused the transfer of at least approximately $40 million in cryptocurrency intended for the benefit of one or more Chinese government officials.”
https://twitter.com/CoinStats/status/1640709208265072642
The transaction was allegedly made to influence and induce Chinese officials to unfreeze accounts holding more than $1 billion worth of cryptocurrency at Alameda Research.
The document reveals that in early 2021, Chinese law enforcement authorities had frozen specific Alameda accounts on “two of China’s largest crypto exchanges.” Aware of the situation, the FTX founder attempted various methods to regain access to the frozen accounts, including transferring cryptocurrency to fraudulent accounts as a means to bypass China’s freeze orders.
The court filing further notes that “after months of unsuccessful attempts to unfreeze the accounts, Samuel Bankman-Fried consulted with others and ultimately approved and directed a multi-million-dollar bribe to try to regain access to the accounts.”. Following the account unfreezing under SBF’s guidance, Alameda resumed its trading activities using the unfrozen cryptocurrency.
It is unclear which Chinese cryptocurrency exchanges Alameda was operating on in early 2021, as China had officially prohibited crypto exchanges from providing services within the country since 2017. Moreover, a comprehensive ban on crypto was implemented in September 2021.
The new indictment comes amid a series of high-profile arrests in the cryptocurrency industry, including the recent apprehension of an individual suspected to be Do Kwon, co-founder of Terraform Labs and a key figure in the collapse of the $40 billion Terra Luna (LUNC) and Terra USD (USTC) ecosystem.
FTX’s founder Bankman-Fried is scheduled to face trial on October 2, 2023, for criminal charges of misappropriating billions of dollars in FTX customer funds through Alameda Research.
Additionally, he is accused of making substantial illegal political contributions. SBF has pleaded not guilty to eight criminal counts, which could result in a 115-year prison sentence if he is convicted.
The global cryptocurrency community will be closely watching the developments in both the FTX and Terra Luna cases, as the outcomes may have far-reaching implications for the future of the industry.