The United States Commodity Futures Trading Commission, or CFTC, filed a lawsuit against Sam Bankman-Fried, FTX and Alameda Research, alleging violations of the Commodity Exchange Act and demanding a jury trial.
According to court records filed December 13 in the Southern District of New York, the CFTC filed a lawsuit for injunctive and other equitable relief, as well as civil money penalties, against Bankman-Fried, FTX Trading, and Alameda Research. The complaint alleged that SBF personally directed FTC executives to set up features that would allow Alameda to use the cryptocurrency exchange as a line of credit for its lenders.
"Contrary to [Bankman-Friedโs] In their representations and without disclosure to FTX clients, Alameda and FTX combined funds and freely used FTX client funds as their own, including as capital to implement in their own business and investment activities,โ the CFTC said. โIn my opinion, Bankman-Fried, his parents, and other FTX and Alameda employees used FTX client funds for a variety of personal expenses, including luxury real estate purchases, private jets, documented and undocumented personal loans, and personal political donations. โ
Bahamian authorities arrested Bankman-Fried on December 12 after criminal charges were filed in the United States; the two countries have an extradition agreement. The US Securities and Exchange Commission also filed charges against SBF on December 13, alleging violations of the anti-fraud provisions of the Securities Act of 1933 and the Securities Exchange Act of 1934.
Related: Bahamas allegedly asked SBF to mint a new currency after FTX collapse
Prior to his arrest, Bankman-Fried was scheduled to testify before the House Financial Services Committee on December 13 about the FTX collapse. The former CEO's leaked written testimony had him largely blame others by the fall of the exchange.
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Former CEO of cryptocurrency company arrested
