Bankman-Fried accused of bribing Chinese authorities

by Arthur · March 28, 2023

Table of Contents

Important takeaways

Sam Bankman-Fried allegedly bribed Chinese officials to release Alameda funds on Chinese crypto exchanges.
Prosecutors allege he transferred at least $40 million to unblock funds.
Bankman-Fried has already been charged with twelve other matters.

US prosecutors believe Sam Bankman-Fried resorted to bribery to release over $1 billion of Alameda Research’s crypto assets from Chinese exchanges in 2021.

40 million dollar bribe

Sam Bankman-Fried’s case keeps getting worse and worse.

Today, US prosecutors unveiled a new charge against the former FTX boss. Bankman-Fried is accused of paying at least $40 million in bribes to Chinese government officials in 2021.

According to the indictment, the purpose of the bribe was to influence Chinese officials to release two trading accounts from Alameda Research that contained over $1 billion in cryptocurrencies. The filing indicates that the trading accounts were held on two of China’s largest crypto exchanges, although the exchanges themselves are not named. The funds were reportedly frozen due to an investigation regarding an Alameda counterparty.

Prosecutors allege that Bankman-Fried attempted to release the funds in a variety of ways, including lobbying, communicating directly with exchanges and fraudulently opening new accounts on those exchanges using the personal information of individuals not associated with FTX or Alameda and then attempting to move the freeze the funds for these new accounts. Bankman-Fried eventually ordered the transfer of $40 million in cryptocurrency to a private wallet, in several installments. Around the same time, Alameda’s funds were unfrozen.

Bankman-Fried is now charged with conspiracy to violate the anti-bribery provisions of the Foreign Corrupt Practices Act. He has already been charged with 12 other counts, including wire fraud, securities fraud, commodities fraud, bank fraud, operating an unlicensed money transmitter and conspiracy to make illegal political contributions.

Three of Bankman-Fried’s closest associates – FTX co-founder Gary Wang, Alameda Research CEO Caroline Ellison and FTX chief engineer Nishad Singh – have already pleaded guilty to various fraud charges and are reportedly cooperating with law enforcement.

Disclaimer: At the time of writing, the author of this piece owned BTC, ETH and several other crypto assets.

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