FTX Task Force: US investigators to ‘trace and recover’ missing customer funds
The Manhattan US Attorney’s Office has revealed it has created an FTX Task Force to “trace and recover” missing customer funds and handle investigations and prosecutions related to the collapse of FTX.
The cryptocurrency exchange filed for bankruptcy on 11 November 2022, after which Sam Bankman-Fried (SBF), founder and former CEO of FTX, was arrested in the Bahamas a month later before being extradited to the United States.
SBF is accused of illegally using FTX customer deposits to support the quantitative crypto trading firm Alameda Research, which he also founded, as well as buying real estate and providing millions of dollars in political contributions to both the Democratic and Republican parties in the United States.
The former FTX CEO has been charged with two counts of wire fraud and six conspiracy counts, including to launder money and commit campaign finance violations, which could result in 115 years in prison if convicted.
However, despite an agreement to cooperate with prosecutors and guilty pleas from Caroline Ellison, Alameda’s former chief executive officer, and Gary Wang, FTX’s former chief technology officer, to seven and four criminal charges, respectively, Bankman-Fried has pleaded not guilty to his charges.
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‘It is an all-hands-on-deck moment’
Manhattan US Attorney Damian Williams, who is the federal prosecutor in the FTX case, told CNBC: “The Southern District of New York [SDNY] is working around the clock to respond to the implosion of FTX. It is an all-hands-on-deck moment.
Williams’ deputy, Andrea Griswold, will lead the task force, which will work with specialist units covering securities and commodities fraud, public corruption, and money laundering and transnational criminal enterprises.
The US Securities and Exchange Commission (SEC) has estimated that customers lost more than $8bn (£6.6bn) as a consequence of the alleged fraud at FTX and Alameda Research.
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