Accused crypto-fraudster Sam Bankman-Fried’s alleged accomplices were placed on notice Tuesday that they faced imminent arrest — and were urged to begin cooperating before it’s too late.
Manhattan US Attorney Damian Williams said his “all-hands-on-deck investigation” into the $8 billion-plus collapse of Bankman-Fried’s FTX cryptocurrency exchange and Alameda Research hedge fund “may be very much ongoing and it’s moving in a short time.”
“But I also wish to be clear about something else: while that is our first public announcement, it’s going to not be our last,” he said during a day news conference in Lower Manhattan to formally unveil the costs against Bankman-Fried.
Williams noted that Bankman-Fried’s eight-count indictment referenced unidentified co-conspirators and in addition said that various, unidentified people were cooperating with the federal probe into “one in every of the largest financial frauds in American history.”
“To anyone who participated in wrongdoing at FTX or Alameda Research and who has not yet come forward, I’d strongly encourage you to come back see us before we come to you,” he said.
Williams said Bankman-Fried’s alleged scam encompassed “4 areas of misconduct” that involved defrauding FTX customers and investors, Alameda’s lenders, in addition to violating campaign finance laws by making tens of thousands and thousands of dollars in political donations to “each Democrats and Republicans.”
“These contributions were disguised to seem like they were coming from wealthy co-conspirators when, actually, the contributions were funded by Alameda Research with stolen customer money,” he said.
“And all this dirty money was utilized in service of Bankman-Fried’s desire to purchase bipartisan influence and impact the direction of public policy in Washington.”
Gurbir Grewal, the Securities and Exchange Commission’s director of enforcement, said Bankman-Fried “raised greater than $1.8 billion from equity investors on the premise of lies” while operating “behind a veneer of legitimacy.”
But Grewal said the “entire house of cards began to crumble as crypto prices plummeted in May of 2022.”
“That collapse has had far-reaching consequences for FTX customers, for its investors and for its counterparties,” he said. “But one immediate takeaway from today’s announcement must be that non-compliant trading platforms pose dramatic risks to each their investors and to their customers.
“Amongst other things, they don’t provide them with the identical robust level of disclosures and protections against fraud and conflicts of interest. That’s what traditional, US-registered securities exchanges provide. So it’s imperative that non-compliant platforms come into compliance,” he added.
Accused crypto-fraudster Sam Bankman-Fried’s alleged accomplices were placed on notice Tuesday that they faced imminent arrest — and were urged to begin cooperating before it’s too late.
Manhattan US Attorney Damian Williams said his “all-hands-on-deck investigation” into the $8 billion-plus collapse of Bankman-Fried’s FTX cryptocurrency exchange and Alameda Research hedge fund “may be very much ongoing and it’s moving in a short time.”
“But I also wish to be clear about something else: while that is our first public announcement, it’s going to not be our last,” he said during a day news conference in Lower Manhattan to formally unveil the costs against Bankman-Fried.
Williams noted that Bankman-Fried’s eight-count indictment referenced unidentified co-conspirators and in addition said that various, unidentified people were cooperating with the federal probe into “one in every of the largest financial frauds in American history.”
“To anyone who participated in wrongdoing at FTX or Alameda Research and who has not yet come forward, I’d strongly encourage you to come back see us before we come to you,” he said.
Williams said Bankman-Fried’s alleged scam encompassed “4 areas of misconduct” that involved defrauding FTX customers and investors, Alameda’s lenders, in addition to violating campaign finance laws by making tens of thousands and thousands of dollars in political donations to “each Democrats and Republicans.”
“These contributions were disguised to seem like they were coming from wealthy co-conspirators when, actually, the contributions were funded by Alameda Research with stolen customer money,” he said.
“And all this dirty money was utilized in service of Bankman-Fried’s desire to purchase bipartisan influence and impact the direction of public policy in Washington.”
Gurbir Grewal, the Securities and Exchange Commission’s director of enforcement, said Bankman-Fried “raised greater than $1.8 billion from equity investors on the premise of lies” while operating “behind a veneer of legitimacy.”
But Grewal said the “entire house of cards began to crumble as crypto prices plummeted in May of 2022.”
“That collapse has had far-reaching consequences for FTX customers, for its investors and for its counterparties,” he said. “But one immediate takeaway from today’s announcement must be that non-compliant trading platforms pose dramatic risks to each their investors and to their customers.
“Amongst other things, they don’t provide them with the identical robust level of disclosures and protections against fraud and conflicts of interest. That’s what traditional, US-registered securities exchanges provide. So it’s imperative that non-compliant platforms come into compliance,” he added.
