Sam Bankman-Fried, the cryptocurrency entrepreneur who has struggled to control the narrative and allay fraud suspicions since his FTX exchange collapsed in early November, was detained on Monday in the Bahamas, according to a statement from the nation’s attorney general.
The arrest occurred “following receipt of formal notification from the United States that it has filed criminal charges against SBF and is likely to request his extradition,” according to the statement. Bankman-Fried remained in the island nation where FTX is headquartered after being forced to resign as CEO. The company, which was once one of the world’s largest crypto platforms and was valued at $32 billion, is now in bankruptcy proceedings.
The Bahamas will continue its own regulatory and criminal investigations into Bankman-Fried, according to Prime Minister Philip Davis, regardless of the measures the U.S. government may take against Bankman-Fried.
While it’s not surprising that Bankman-Fried would be arrested a month after FTX imploded, leaving many investors out of pocket and a slew of unanswered questions about what happened, it’s an outcome he had tried to avoid.
When asked if he felt it was safe to travel to the United States without worrying about being detained, he replied that he thought it was safe and that he lacked any criminal responsibility. Additionally, he declared that the prospect of being charged with a crime was not what he is focusing on.
The 30-year-old Bankman-Fried, once hailed as a wunderkind, defended himself against claims of misusing client funds, shady real estate dealings in the Bahamas, and a hedonistic atmosphere at FTX’s offices and residential properties there during that event and other interviews granted against sound legal advice. Midway through November, his former legal counsel at the law firm Paul Weiss fired him in part due to his persistent tweeting.
Sens. Sherrod Brown and Pat Toomey criticized Bankman-Fried’s refusal to appear before the Senate Banking Committee as “an unprecedented abdication of accountability” just before the arrest was reported. He has, however, accepted several invitations to speak on Twitter Spaces, and on Monday morning he did so in front of thousands of people while allegedly playing video games.
SBF’s explanations for the enormous crash he oversaw have remained frustratingly nebulous and incomplete, despite his purported openness so far. No matter the outcome, a formal prosecution will change that by presenting concrete evidence and cooperative witnesses. His “I screwed up” defense probably won’t work going forward.
