Sam Bankman-Fried Signs Legal Papers Clearing Way for US Extradition to Face Fraud Charges, Official Says

Wednesday's proceeding could set the stage for 30-year-old Sam Bankman-Fried to depart the Caribbean nation.

By Reuters | Updated: 21 December 2022 13:32 IST

Sam Bankman-Fried Signs Legal Papers Clearing Way for US Extradition to Face Fraud Charges, Official Says

Photo Credit: Reuters

Bankman-Fried has been under increasing scrutiny since early November

Highlights

Bankman-Fried was arrested last week in The Bahamas
He initially told a Bahamas court he would contest extradition
Bankman-Fried has acknowledged risk-management failures at FTX

FTX founder Sam Bankman-Fried has signed legal papers paving the way for his extradition from The Bahamas to the United States, where he faces fraud charges over the cryptocurrency exchange's collapse, a Bahamas official said on Tuesday.

Doan Cleare, The Bahamas' acting commissioner of Corrections, told Reuters the documents were signed around noon on Tuesday. A hearing in Bankman-Fried's case will take place on Wednesday at 11:00am EST (9:30pm IST), a court official told Reuters.

Wednesday's proceeding could set the stage for the 30-year-old cryptocurrency mogul to depart the Caribbean nation, after several days of confusion about the status of Bankman-Fried's extradition.

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A US-based lawyer for Bankman-Fried did not respond to requests for comment. A person familiar with the matter said Bankman-Fried intends to consent to extradition. Bankman-Fried has acknowledged risk-management failures at FTX, but has said he does not believe he has criminal liability.

A spokesman for the US attorney's office in Manhattan declined to comment.

Bankman-Fried was arrested last week in The Bahamas, where he lives and where FTX was based, after a grand jury sitting in Manhattan federal court indicted him for allegedly stealing customer funds to plug losses at Alameda Research, his crypto hedge fund.

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He initially told a Bahamas court he would contest extradition, but Reuters and other outlets reported over the weekend that he would reverse his decision.

During a court hearing on Monday at which Bankman-Fried appeared, his local defence lawyer Jerone Roberts said he had not been informed of the purpose of the proceeding. He later said that while his client had seen an affidavit laying out the charges against him, he wanted to access the complete indictment before agreeing to extradition.

Earlier on Tuesday, Roberts declined to comment as he departed Magistrate Court in capital Nassau. US embassy officials earlier entered the courthouse, a Reuters witness said, but Bankman-Fried was not seen on Tuesday.

Fall from Grace

The arrest capped a stunning fall from grace for Bankman-Fried, who rode a boom in the values of bitcoin and other digital assets to become a billionaire several times over.

He has been under increasing scrutiny since early November, when customers raced to withdraw funds from FTX amid concerns over commingling of their assets with Alameda.

Damian Williams, the top federal prosecutor in New York City, said last week that Bankman-Fried's actions amounted to "one of the biggest financial frauds in American history."

The $32 billion (roughly Rs. 2,64,700 crore) exchange declared bankruptcy on November 11, and Bankman-Fried stepped down as CEO the same day.

He has since been detained at The Bahamas Department of Corrections in Nassau, formerly known as Fox Hill prison. The US State Department in a 2021 report described conditions at the facility as "harsh," citing overcrowding, rodent infestation and prisoners relying on buckets as toilets.

Local authorities say conditions have since improved.

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