The SEC Accuses Sam Bankman-Fried of “Orchestrating a Massive, Years-Long Fraud”

U.S. Securities and Exchange Commission
U.S. Securities and Exchange Commission

The Securities and Exchange Commission on Tuesday said it had charged Samuel Bankman-Fried with defrauding investors in FTX, the crypto trading platform he cofounded.

In its complaint, the SEC accused Bankman-Fried of “orchestrating a massive, years-long fraud” by diverting “billions of dollars” of FTX’s customer funds for “his own personal benefit and to help grow his crypto empire.”

The disgraced crypto star, arrested on Monday in the Bahamas, raised over $1.8 billion from investors, the SEC said in its complaint. 

The SEC accuses Bankman-Fried of diverting FTX customers’ funds to Alameda Research, his crypto hedge fund, without users’ consent as well as using the funds to make “undisclosed venture investments, lavish real estate purchases, and large political donations,” per the complaint.

The SEC announced in its complaint that Bankman-Fried kept this information private, and hid it from equity investors of FTX. The commission said his statements about customer assets being safe and secure were “false and misleading.”