FTX founder Sam Bankman-Fried arrested in the Bahamas on the eve of congressional testify

The Royal Bahamas Police Force arrested FTX founder Sam Bankman-Fried, following the US authorities filed criminal charges against him. The Bahamas intends to extradite Bankman-Fried after US officials request it. Meanwhile, the “surprising” arrest comes just a day before a scheduled hearing before the US House Financial Services Committee hearing on the FTX collapse, “disappointing” Committee’s chair Maxine Waters.

According to a press statement, the arrest came after the US filed criminal charges against Sam Bankman-Fried (SBF), and the nation expects the US to request The Bahamas extradite SBF in short terms.

“As a result of the notification received and the material provided therewith, it was deemed appropriate for the Attorney General to seek SBF’s arrest and hold him in custody pursuant to our nation’s Extradition Act,” Attorney General Ryan Pinder said in the statement. “At such time as a formal request for extradition is made, The Bahamas intends to process it promptly, pursuant to Bahamian law and its treaty obligations with the United States.”

The US Attorney’s Office for the Southern District of New York confirmed on Twitter that prosecutors in the US indicted SBF, with the indictment remains closed.

As the New York Times reported, the charges could include wire fraud, securities fraud, money laundering, and related conspiracy charges.

Meanwhile, the US Securities and Exchange Commission (SEC) also plans to bring charges, Enforcement Director Gurbir Grewal said in a statement.

“We commend our law enforcement partners for working to secure the arrest of Mr. Sam Bankman-Fried in the Bahamas on federal criminal charges,” Grewal said. “The Securities and Exchange Commission has separately authorized charges relating to Mr. Bankman-Fried’s violations of our securities laws, which will be filed publicly tomorrow in the Southern District of New York.”

Alongside the US’s criminal charges, Bahamas Prime Minister Philip Davis said in an official statement that the country would continue pursuing its own investigation of FTX’s collapse.

Meanwhile, the arrest of Bankman-Fried comes just one day before he was scheduled on Tuesday to testify virtually before the US House Financial Services Committee for its first hearing on the FTX collapse.

In a statement, committee Chair Maxine Waters said she was “disappointed” and “surprised to hear” of the arrest at the US Attorney’s office’s direction before her committee hearing tomorrow.

“It’s about time the process to bring Mr. Bankman-Fried to justice has begun,” Waters said in the statement. “However, as the public knows, my staff and I have been working diligently for the past month to secure Mr. Bankman-Fried’s testimony before our Committee tomorrow morning.”

“Although Mr. Bankman-Fried must be held accountable, the American public deserves to hear directly from Mr. Bankman-Fried about the actions that’ve harmed over one million people, and wiped out the hard-earned life savings of so many,” the California Democrat added in the statement. “The public has been waiting eagerly to get these answers under oath before Congress, and the timing of this arrest denies the public this opportunity.”

Nevertheless, The Financial Services Committee will still hear from current FTX CEO John Ray III tomorrow about his view on the company’s collapse. In written remarks that will begin his testimony, Ray details how FTX US did not operate separately from the main corporate entity, potentially violating the law and refuting Bankman-Fried’s position that the U.S. affiliate did not need to be entered into the bankruptcy process. The committee is also expected to touch on other digital asset topics, including Binance’s role in the implosion and the broader state of the industry.