Sam Bankman-Fried, a co-founder of FTX, was charged with sending tens of millions of dollars in bribes to at least one member of the Chinese government, according to federal prosecutors in a fresh indictment released on Tuesday.
The superseding indictment, which the Southern District Court of New York released on March 28, was the 13th criminal charge brought against Bankman-Fried, who is now under house arrest at his parents’ Palo Alto.
On November 11, FTX declared bankruptcy after running out of money following the cryptocurrency equivalent of a bank run. A USD 250 million personal recognizance bond that allows him to reside in Palo Alto, California, has allowed him to remain free.
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The former tycoon, 31, who had previously pleaded not guilty to eight counts of cheating investors by using their money to repair losses for Alameda, now faces 13 more foreign bribery accusations, which puts further pressure on him.
In November 2021, Bankman-Fried and his associates allegedly tried “various techniques” to unfreeze the funds, according to the new accusation.
According to reports, the bribe was an effort to persuade Chinese authorities to unfreeze some of the accounts linked to FTX’s sister business, Alameda, which had more than $1 billion in cryptocurrencies.
The bribe payment of cryptocurrency — then worth about $40 million — was moved from Alameda’s main trading account to a private cryptocurrency wallet in November 2021 and the frozen accounts were unfrozen at about the same time, the indictment said.
He then allegedly utilized the funds to support Alameda’s unsuccessful trades, continuing to mislead clients and investors for an additional year before the collapse of the bitcoin exchange.
According to the DOJ, all of this occurred in November 2021, at a time when Bankman-Fried wanted access to the funds in order to assist Alameda “in obtaining and retaining business.
An arraignment on the rewritten indictment was set for Thursday by U.S. District Judge Lewis A. Kaplan.