Sam Bankman-Fred agrees to extradition from the Bahamas to face US charges

Suspension

NASSAU, Bahamas – Sam Bankman-Fried has voluntarily agreed to be extradited to the United States, where he has been accused of defrauding clients of his cryptocurrency exchange, FTX, a person familiar with the matter confirmed Monday.

The decision was confirmed after a chaotic morning in court as the embattled former CEO showed up but the hearing was suddenly adjourned.

Back in the US, Bankman Fried, 30, is He faces multiple criminal and civil charges He was charged with conspiracy, fraud, money laundering and campaign finance violations. According to legal experts, his extradition could speed up the adjudication of criminal and civil cases pursued by the US government.

Eric Lewis, a lawyer and expert on extradition cases, said Bankman-Fried’s decision to agree to extradition may have been due to his unwillingness to spend months in a Bahamas prison, Where conditions are notorious. While Bankman-Fried has the legal right to challenge the extradition, plaintiffs may view it negatively “when it comes time to consider both bail and potential sentencing.”

Prosecuting the case on US soil would help deter others who might be tempted to do what Bankman-Fried is accused of doing, said Carl Tobias, a University of Richmond law professor. It would also show that the US Department of Justice and regulatory agencies charged with protecting consumers from alleged fraud are doing “everything they can to prevent this type of behavior,” he added.

Tobias noted that if the disgraced former CEO continues to agree to extradition, the Southern District can determine prosecution and take steps to move the case more quickly to trial and final resolution, which will be beneficial to the United States government in its pursuit of justice, defrauding FTX clients and to the wider audience.

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Bankman-Fried’s legal team is preparing the necessary legal documents and said Bankman-Fried is expected to return to court this week.

Once he is returned to the United States, the crypto entrepreneur will be brought to federal court for the Southern District of New York.

Lewis, an extradition expert, said Bankman-Fred would likely face a bail hearing if he returned to the United States. He said bail could be difficult, given that Bankman Fried is a high-profile defendant, faces a heavy prison sentence and may have access to significant funds.

Bankman-Fried, dressed in a navy blue suit and white shirt, sat on a wooden bench during the Monday morning court hearing as he was expected to tell Bahamas authorities that he did not want to resist extradition after all.

But the hearing only lasted about 10 minutes, after Bankman-Fried’s local defense attorney, Jeron Roberts, said he was on his way to jail to talk to his client about possible extradition, when he learned he was in court. Roberts denounced that the proceedings were moving “prematurely” and without him taking “any part in it”.

In a heated presentation, Roberts said he was not informed of the procedures and initially asked for a 45-minute break to confer with Bankman-Fried. He then requested a copy of the indictment filed by United States prosecutors, for his client to read and know “what he is facing,” as well as additional time to speak with his client and his legal representatives in the United States.

Attorney General Franklin Williams rebuked Roberts, saying he did not wish to be part of “a play that was unfolding”.

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The 30-year-old former tycoon was arrested last Monday in his luxury apartment in Nassau at the request of the US government. He was then transferred to the only prison in the country, Fox Hill, notorious for its poor and unsanitary conditions.

According to a prison official with whom he was in direct contact, Bankman-Fried has since spent his days Watch movies And read the news, mostly about the same.

During this time, the disgraced former CEO was hoping his lawyers could secure him bail even later at first. to reject last week by a judge on the grounds that Bankman-Fried was a flight risk because of his access to “significant resources”. His lawyers then filed a new application for bail with the Bahamas Supreme Court, which granted a hearing on January 17.

By Friday, he was considering dropping his extradition fight so he could be brought to the United States to face charges, The Washington Post reported.

It was Bankman Fried Accused in US Federal Court a day after his arrest for his involvement in a scheme to defraud FTX clients by diverting their crypto assets to pay off debts and expenses incurred by his hedge fund, Alameda Research. He was also accused of using clients’ money to invest in other companies and make political donations. Now it appears that a lot of money is missing.

“This is one of the largest financial frauds in American history,” US Attorney General Damian Williams said last week in New York. He added that the alleged fraud destroyed “billions of dollars in client value overnight”.

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Until recently, FTX was one of the largest cryptocurrency exchanges in the world, with a valuation of $32 billion. The company has created a legitimate veneer, won investment from respected venture capital firms, paid to have its logo on Major League Baseball referee uniforms, and spent lavishly on Super Bowl ads.

Bankman-Fried has also donated tens of millions of dollars to politicians, to become the second largest Democratic donor in the 2022 midterm elections and build a reputation for himself in Washington.

But now, the stunning downfall of the company and its founder has deepened the sense that the cryptocurrency bubble has Explosion, Eliminate billions of dollars in investments made by ordinary people, pension funds, venture capitalists and traditional corporations.

In addition to the criminal charges, Bankman-Fried also faces civil lawsuits from the Securities and Exchange Commission and the CFTC.

Despite the complex nature of the circumstances surrounding FTX’s collapse, the cause “wasn’t complicated at all,” John J. Ray III, FTX’s new CEO, told lawmakers this week. “This is just plain old embezzlement,” said the corporate liquidation expert in testimony before the House Financial Services Committee.

Gerrit De Vinck in San Francisco and Julian Mark in Washington contributed to this report.

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