The Justice Department is investigating the possible fraud of Sam Bankman-Freed. The FTX fiasco isn’t over yet.
US federal prosecutors are reportedly pursuing a fraud case against former FTX founder and CEO Sam Bankman-Fried. Bloomberg reports that Justice Department officials met with the cryptocurrency exchange’s bankruptcy management team this week to further discuss the documents that investigators are asking for from the company.
DOJ Investigates Possible Fraud by Sam Bankman-Fried
Attendees at this meeting include US Attorneys for the Southern District of New York, Counsel Roos, agents from the Federal Bureau of Investigation, and FTX lawyers. Roos has been heavily involved in lawsuits against Trevor Milton, the founder of Nikola, who was found guilty of defrauding investors a few months ago. The potential allegations were not discussed at that meeting, according to Bloomberg.
The Justice Department is looking “closely”into whether FTX was improperly transferring hundreds of millions of dollars around the time the company filed for bankruptcy on Nov. 11. The Justice Department also wants to know if the exchange broke the law when it transferred funds to its subsidiary, Alameda Research.
The FTX Fiasco Isn’t Over Yet
In a recent interview with The New York Times, Sam Bankman-Fried denied any misuse of client funds. “Of course I made a lot of mistakes. There are things for which I would give everything that I have to do them again, ”he said. “I have never tried to commit any kind of fraud on anyone.”In the coming days, he will testify before the House Financial Services Committee, whose jury will also include testimony from current FTX CEO John J. Ray III. The latter accused Sam Bankman-Fried of making “inconsistent and misleading public statements”regarding FTX.