{"id":15425,"date":"2022-12-13T15:16:08","date_gmt":"2022-12-13T15:16:08","guid":{"rendered":"https:\/\/crowdfundjunction.com\/blog\/us-securities-watchdog-charges-sam-bankman-fried-with-fraud-over-ftx-collapse-bitcoin-news\/"},"modified":"2022-12-13T15:16:08","modified_gmt":"2022-12-13T15:16:08","slug":"us-securities-watchdog-charges-sam-bankman-fried-with-fraud-over-ftx-collapse-bitcoin-news","status":"publish","type":"post","link":"https:\/\/crowdfundjunction.com\/blog\/us-securities-watchdog-charges-sam-bankman-fried-with-fraud-over-ftx-collapse-bitcoin-news\/","title":{"rendered":"US Securities Watchdog Charges Sam Bankman-Fried With Fraud Over FTX Collapse \u2013 Bitcoin News"},"content":{"rendered":"

(Originally posted on : Bitcoin News )<\/b>
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According to a statement published on Dec. 13, 2022, the U.S. Securities and Exchange Commission (SEC) has charged the disgraced FTX co-founder Sam Bankman-Fried (SBF) with defrauding investors. SEC chairman Gary Gensler explained that the U.S. financial regulator alleges that SBF \u201cbuilt a house of cards on a foundation of deception.\u201d<\/strong><\/p>\n

U.S. SEC Contends Former FTX CEO SBF Committed Fraud, Crypto Firms Warned the \u2018Sec\u2019s Enforcement Division Is Ready to Take Action\u2019<\/h2>\n

Following the arrest of the former FTX CEO Sam Bankman-Fried (SBF) in The Bahamas, the U.S. Securities and Exchange Commission (SEC) has revealed charges<\/a> against the FTX co-founder. The SEC complaint contends that \u201cBankman-Fried orchestrated a years-long fraud to conceal from FTX\u2019s investors\u201d the undisclosed funneling of customer funds from FTX to Alameda Research. This includes providing Alameda \u201cwith a virtually unlimited \u2018line of credit\u2019 funded by the platform\u2019s customers.\u201d<\/p>\n

In addition to the SEC, on Dec. 12, 2022, after SBF was arrested, a report<\/a> detailed that the Southern District of New York (SDNY) prosecutors office and SDNY attorney Damian Williams have confirmed SBF was charged. The report noted that SBF\u2019s charges included \u201cwire fraud, wire fraud conspiracy, securities fraud, securities fraud conspiracy, and money laundering.\u201d<\/p>\n

\u201cEarlier this evening, Bahamian authorities arrested Samuel Bankman-Fried at the request of the U.S. Government, based on a sealed indictment filed by the SDNY,\u201d Williams disclosed<\/a> on Twitter. \u201cWe expect to move to unseal the indictment in the morning and will have more to say at that time.\u201d In the press release published by the SEC, chairman Gary Gensler<\/a> explained that the U.S. regulator believes SBF is responsible for defrauding investors.<\/p>\n

\u201cWe allege that Sam Bankman-Fried built a house of cards on a foundation of deception while telling investors that it was one of the safest buildings in crypto,\u201d Gensler remarked in a statement.<\/p>\n

\u201cThe alleged fraud committed by Mr. Bankman-Fried is a clarion call to crypto platforms that they need to come into compliance with our laws,\u201d Gensler continued. \u201cCompliance protects both those who invest on and those who invest in crypto platforms with time-tested safeguards, such as properly protecting customer funds and separating conflicting lines of business. It also shines a light into trading platform conduct for both investors through disclosure and regulators through examination authority.\u201d<\/p>\n

Gensler further added a warning for other crypto platforms:<\/p>\n

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To those platforms that don\u2019t comply with our securities laws, the SEC\u2019s Enforcement Division is ready to take action.<\/p>\n<\/blockquote>\n

The SEC charges follow the controversy<\/a> that surrounded Gensler and his meeting with Sam Bankman-Fried on March 29. Congressman Tom Emmer explained in a tweet that his office received reports that the SEC chairman allegedly helped SBF with legal loopholes. Yet a contradictory view of the meeting reported on by Fox Business correspondent Charles Gasparino claims that Gensler gave SBF a \u201c45-minute lecture.\u201d Gasparino alleged that Gensler made no promises to SBF, and \u201cordered [FTX] to provide much more in the way of disclosure etc to the SEC about their model.\u201d<\/p>\n

Additionally, the chairman of the Commodity Futures Trading Commission (CFTC), Rostin Behnam, recently told the press<\/a> that the CFTC met with SBF roughly ten times before FTX collapsed. The director of the SEC\u2019s Division of Enforcement, Gurbir S. Grewal, stressed that \u201cBankman-Fried [is] responsible for fraudulently raising billions of dollars from investors in FTX and misusing funds belonging to FTX\u2019s trading customers.\u201d The fraud, Grewal said, was painted as legitimate, and the SEC alleges that the perception of legitimacy was the furthest from the truth.<\/p>\n

\u201cFTX operated behind a veneer of legitimacy Mr. Bankman-Fried created by, among other things, touting its best-in-class controls, including a proprietary \u2018risk engine,\u2019 and FTX\u2019s adherence to specific investor protection principles and detailed terms of service,\u201d Grewal detailed. \u201cBut as we allege in our complaint, that veneer wasn\u2019t just thin, it was fraudulent.\u201d<\/p>\n

According to the SEC, SBF is also being charged by other law enforcement officials and financial regulators in the United States. This includes the U.S. Attorney\u2019s Office for the Southern District of New York and the Commodity Futures Trading Commission (CFTC). The ongoing investigation will be conducted by members of the SEC\u2019s Crypto Assets and Cyber Unit.<\/p>\n

\u201cThe SEC\u2019s complaint seeks injunctions against future securities law violations; an injunction that prohibits Bankman-Fried from participating in the issuance, purchase, offer, or sale of any securities, except for his own personal account; disgorgement of his ill-gotten gains; a civil penalty; and an officer and director bar,\u201d the SEC\u2019s charges against SBF conclude.<\/p>\n

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\nTags in this story
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Alameda Research<\/a>, Arrest<\/a>, Bankman-Fried<\/a>, Caroline Ellison<\/a>, CFTC<\/a>, criminal charges<\/a>, Fraud<\/a>, Fraud Charges<\/a>, Fraud FTX<\/a>, FTX Bankruptcy<\/a>, FTX collapse<\/a>, FTX fraud<\/a>, FTX implosion<\/a>, Gary Gensler<\/a>, House Of Cards<\/a>, Rostin Behnam<\/a>, Sam Bankman-Fried<\/a>, Sam Bankman-Fried (SBF)<\/a>, sbf<\/a>, sec chair<\/a>, sec chairman<\/a>, SEC charges<\/a>, SEC\u2019s Enforcement Division<\/a><\/div>\n<\/div>\n

What do you think about the SEC\u2019s charges against Sam Bankman-Fried? Let us know what you think about this subject in the comments section below. <\/strong><\/em><\/p>\n

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\nJamie Redman <\/h6>\n

\nJamie Redman is the News Lead at Bitcoin.com News and a financial tech journalist living in Florida. Redman has been an active member of the cryptocurrency community since 2011. He has a passion for Bitcoin, open-source code, and decentralized applications. Since September 2015, Redman has written more than 6,000 articles for Bitcoin.com News about the disruptive protocols emerging today.

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Image Credits<\/b>: Shutterstock, Pixabay, Wiki Commons<\/em><\/p>\n

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