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In a newly revised indictment that was unveiled on Tuesday, FTX founder Sam Bankman-Fried was accused of paying $40 million in bribes to one or more Chinese authorities in order to have assets connected to his cryptocurrency business unfrozen.
After being detained in the Bahamas in December and transported to the US soon after, Bankman-Fried now faces a total of 13 accusations, including one for conspiring to break the Foreign Corrupt Practices Act's anti-bribery provisions. On Monday, the indictment was returned.
The charge also includes wording that suggests a fifth arrest in the ongoing investigation, as indicated by US Attorney Damian Williams, is about to be made. The indictment claims that this unnamed person collaborated on the bribery scheme with Bankman-Fried and "will be arrested in the Southern District of New York."
When FTX ran out of money following the worldwide cryptocurrency exchange's equivalent of a bank run, it filed for bankruptcy on November 11. A $250 million personal recognizance bond that permits him to reside in Palo Alto, California, with his parents has allowed him to remain free.
Judge Lewis A. Kaplan of the US District Court has scheduled an arraignment on the revised indictment for Thursday. Additionally, he forbade Bankman-Fried on Tuesday from getting in touch with any current or former workers of FTX or Alameda Research, the company's linked cryptocurrency hedge fund trading firm. The order further forbids Bankman-Fried from using any other cellphones, laptops, or "smart" gadgets that have internet access as well as restricts him to using only one laptop and phone.
The alleged bribes came from the way Alameda Research was run. According to the accusation, two of China's top cryptocurrency exchanges had roughly $1 billion in cryptocurrencies in particular Alameda cryptocurrency trading accounts that Chinese law enforcement officials had frozen in early 2021.
According to the accusation, Bankman-Fried, 31, was aware that the accounts had been frozen by Chinese authorities as part of an ongoing investigation of a specific trading counterparty in Alameda.
The accusation stated that Bankman-Fried ultimately consented to direct a multimillion-dollar payment to try to unfreeze the accounts after numerous attempts over several months, including using lawyers to push, to no avail.
In an attempt to evade freeze orders and transfer cryptocurrency from frozen accounts to the fraudulent accounts, the indictment claims that Bankman-Fried and those under his direction opened new fraudulent accounts on Chinese exchanges using the personal information of several people who were not connected to FTX or Alameda.
