A day after the crypto tycoon was arrested in the Bahamas at the request of the United States on Tuesday, the US Securities and Exchange Commission filed charges against the massive cryptocurrency exchange company and its ex-CEO Sam Bankman-Fried for defrauding customers of $1.8 billion, according to a report by CNN.
The SEC claimed that in his transactions with FTX crypto investors, Bankman-Fried "built a house of cards on a foundation of deception."
Our lawsuit states, "Today we are holding Mr. Bankman-Fried responsible for fraudulently raising billions of dollars from investors in FTX and misusing funds belonging to FTX's trading customers."
Mr. Bankman-Fried has been hit with charges from both the CFTC and the U.S. Attorney's Office for the Southern District of New York.
Following a revelation on November 2 detailing ties between FTX and Alameda, another trading company controlled by Bankman-Fried, FTX stock plummeted after hitting a valuation of $32 billion. The research revealed that a significant portion of Alameda's finances is based on FTT tokens, a currency developed by FTX that lacks any intrinsic value.
As a result, the company filed for bankruptcy, wiping away the investments of millions of people around the world, including a dozen in Africa.
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