Bankman-Fried charged in Chinese bribe

FILE PHOTO: Former FTX Chief Executive Sam Bankman-Fried, who faces fraud charges over the collapse of the bankrupt cryptocurrency exchange, departs from his court hearing at Manhattan federal court in New York City, U.S. January 3, 2023. REUTERS/David Dee Delgado/File Photo
FILE PHOTO: Former FTX Chief Executive Bankman-Fried departs from his court hearing at Manhattan federal court

OAN Roy Francis
UPDATED 2:56 PM ā€“ Wednesday, March 29, 2023

United States prosecutors have unveiled a new indictment against Sam Bankman-Fried, accusing the FTX cryptocurrency exchange founder of paying a $40 million bribe to Chinese officials.

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The new indictment from the U.S. District Court for the Southern District of New York, stated that Bankman-Fried made the $40 million payment to persuade the Chinese government to unfreeze accounts that contained more than $1 billion in cryptocurrency held through Alameda Research, an affiliated crypto trading hedge fund.

“In or about 2021, Samuel Bankman-Fried, a/k/a/ ā€˜SBF,ā€™ the defendant, authorized and directed a bribe of at least $40 million to one or more Chinese government officials,” the indictment read. “The purpose of this bribe was to influence and induce one or more Chinese government officials to unfreeze certain Alameda trading accounts containing over $1 billion in cryptocurrency, which had been frozen by Chinese authorities.ā€

The Alameda Research accounts had been frozen by Chinese authorities as part of the investigation into an unnamed Alameda counterparty.

Some of the methods that Bankman-Fried had tried to unfreeze the accounts were by ā€œretaining attorneys to lobby or otherwise advocate in China for Alamedaā€™s funds to be unfrozen; communicating with the Chinese Exchanges; and opening new accounts on the Chinese Exchanges using the personal identifying information of several individuals affiliated with FTX or Alameda (the ‘Fraudulent Accounts’) and attempting to transfer the cryptocurrency from the frozen Accounts to the Fraudulent Accounts in an effort to circumvent the Chinese authoritiesā€™ freeze orders,” However, the 31-year-oldā€™s efforts to unfreeze the accounts were unsuccessful.

Prosecutors claimed that Bankman-Fried then tried to complete the bribe by authorizing another transfer of ā€œtens of millions of dollarsā€ around November 2021.

“As a result, in or about November 2021, Bankman-Fried caused a bribe payment of cryptocurrency then worth approximately $40 million to be transferred from Alamedaā€™s main trading account to a private cryptocurrency wallet,” the indictment said. “At or around the time of the $40 million bribe payment, the Accounts were unfrozen.”

Bankman-Fried is now facing a 13-count indictment over the collapse of his cryptocurrency firm in November, which was valued at $40 billion. His charges range from bribery to securities fraud and looting the platform for personal gain.

The 31-year-old has acknowledged inadequate risk management at FTX, however, he has not pleaded guilty to eight of his charges. He has yet to be arraigned on the campaign finance or bribery conspiracy charges.

Three members of his former inner circle, former Alameda CEO Caroline Ellison, former FTX Technology Chief Zixiao ā€œGaryā€ Wang, and former FTX Engineering Director Nishad Singh, have all pleaded guilty and are cooperating with prosecutors.

Bankman-Fried is expected to face arraignment for the newest charge on Thursday before U.S. District Judge Lewis Kaplan in Manhattan Federal Court. Sources say that he intends to plead not guilty.

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