FTX co-founder Sam Bankman-Fried is escorted by corrections officers to the Magistrate’s Court on December 21, 2022 in Nassau, Bahamas.
Joe Raedle | Getty Images
Sam Bankman-Fried is flying Wednesday night to Latest York, based on the office of the Attorney General of The Bahamas, where he’s later expected to be arraigned in U.S. federal court, concluding a days-long saga.
Bankman-Fried, 30, was indicted in Latest York federal court on Dec. 9 and arrested three days later by Bahamas law enforcement on the request of U.S. prosecutors.
His attorney, Jerone Roberts, reading from an affidavit signed Dec. 20, told the court that Bankman-Fried was consenting to extradition partly as a consequence of a “desire to make the relevant customers whole.” Bankman-Fried was “anxious to go away,” Roberts told the court.
It’s unclear how his return would help plug the $8 billion balance sheet hole that, based on federal complaints, got here consequently of dangerous trading and indulgent spending by FTX executives.
Bankman-Fried will face arraignment and bail proceedings after he lands. Unlike other white-collar cases, nonetheless, Bankman-Fried faces a selected set of challenges.
“This is clearly not the everyday case,” former federal prosecutor Renato Mariotti told CNBC. “He’s facing a long time in prison. And he doesn’t have ties to the community in SDNY like a typical defendant would and in addition has ties to a foreign jurisdiction. So prosecutors have a shot at getting the judge to order detention unless the defendant posts property or a big money bond.”
Throughout the extradition waiver process, Bankman-Fried’s Bahamas legal team and U.S. lawyers have seemed to be at loggerheads. His legal team initially stated that they might fight extradition attempts, but on Saturday an individual conversant in the matter told CNBC that the crypto billionaire had modified his mind and would return to america.
On Monday morning, Bankman-Fried’s Bahamas counsel said the previous billionaire would not return to america without viewing a replica of his indictment, with the lawyer telling a Bahamas magistrate that he was “shocked” to even see Bankman-Fried in court.
Chaos ensued as reporters and attorneys for Bankman-Fried attempted to pin down whether the previous crypto billionaire can be rendered back to america for arraignment in federal court.
Finally, on Tuesday, a Bahamas prison official and a source conversant in the matter confirmed that Bankman-Fried had signed extradition paperwork and would seem for his final hearing in Nassau on Thursday.
When Bankman-Fried lands in Latest York, the so-far atypical proceedings should tackle a more familiar tenor. In a typical federal case, the accused “can be taken to the penitentiary for processing before the initial detention hearing/arraignment,” former CFTC trial attorney & Kennyhertz Perry partner Braden Perry told CNBC.
“But again, if arranged prematurely with the magistrate in command of the detention hearing, the court may allow a hearing before processing, but that’s unlikely. His attorneys could also waive the detention hearing, a minimum of for now, and request a more detailed evidentiary hearing to make sure their best arguments are made with proper evidence for detention, as it’s always a one-time shot at getting out before trial,” Perry continued.
Bankman-Fried stands accused by federal law enforcement and financial regulators of perpetrating what the SEC called one among the biggest and most “brazen” frauds in recent memory. Substitute CEO John J. Ray described a “complete failure of corporate control” at the corporate.
Federal regulators have alleged that Bankman-Fried used that $8 billion value of customer assets for extravagant real estate purchases and vanity projects, including stadium naming rights and hundreds of thousands in political donations.
CNBC’s Kate Rooney contributed to this report.