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The Securities and Exchange Commission (SEC) charged Samuel Bankman-Fried on Tuesday, Dec. 13, with defrauding FTX investors out of more than $1.8 billion.
The SEC alleges that Bankman-Fried raised the funds – including $1.1 billion from 90 US-based investors – by falsely promoting a safe, responsible cryptocurrency since May 2019.
"We allege that Sam Bankman-Fried built a house of cards on a foundation of deception while telling investors that it was one of the safest buildings in crypto," said SEC Chair Gary Gensler. "The alleged fraud committed by Mr. Bankman-Fried is a clarion call to crypto platforms that they need to come into compliance with our laws."
Bankman-Fried was set to testify before Congress on Tuesday, but that hearing will go on without him following his arrest, the New York Times reported.
Bankman-Fried, who graduated from the Massachusetts Institute of Technology (MIT) in 2014, was arrested in the Bahamas Monday following a "receipt of formal notification from the United States," a statement from Attorney General Ryan Pinder reads.
Bankman-Fried resigned from FTX after the company collapses and filed for Chapter 11 bankruptcy last month, CBS Boston reports. The SEC's investigation is ongoing.
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