FTX Founder Sam Bankman-Fried Officially Agrees to Be Extradited to US

FTX founder Sam Bankman-Fried (2nd L) is led away handcuffed by officers of the Royal Bahamas Police Force in Nassau, Bahamas, on Dec. 13, 2022. (Mario Duncanson/AFP/Getty Images)

FTX founder Sam Bankman-Fried agreed on Dec. 21 to be extradited to the United States on fraud charges, according to an affidavit read aloud by his lawyer during a court hearing in the Bahamas, where he has been held since being charged by federal prosecutors.

During the court hearing, Bankman-Fried stepped up to the witness stand in court and agreed to be sent back to the United States.

“Yes, I do wish to waive my right to such formal extradition proceedings,“ he told the judge, the Reuters news agency reported. His defense lawyer told the judge that his client was ”anxious to leave.” Video footage also showed Bankman-Fried, known as SBF, signing extradition papers to be sent back to the United States.

Last week, U.S. prosecutors in New York alleged that Bankman-Fried committed wire fraud and conspiracy to commit wire fraud, commodities fraud, securities fraud, money laundering, and fraud against the United States. Bankman-Fried’s alleged crimes date back to 2019, when he allegedly misappropriated FTX customer funds to pay the expenses and debts of Alameda Research, FTX’s crypto hedge fund, according to the indictment.

It wasn’t immediately clear when Bankman-Fried would depart the Caribbean nation for New York.

Officials alleged that the 30-year-old cryptocurrency exchange founder stole billions of dollars in FTX customer assets to deal with losses at Alameda. Last week, he was arrested on a U.S. extradition request in the Bahamas, where he lives and where his company is based.

Damian Williams, the top federal prosecutor in Manhattan, said that Bankman-Fried’s actions amounted to “one of the biggest financial frauds in American history.”

In interviews with media outlets and on social media, Bankman-Fried has acknowledged risk-management failures at his companies, although he said he doesn’t believe it rises to the level of criminal behavior. FTX crashed amid a bevy of customer withdrawals amid concerns about its relationship with Alameda; both companies later filed for bankruptcy.

During an interview with the Wall Street Journal this month, Bankman-Fried conceded that he can’t account for billions that were sent to Alameda from FTX.

“I don’t know of a violation of the terms of use. I don’t know every line of the terms of use. I can’t confidently say there wasn’t, but I don’t know of one,” he said.

“I ask myself a lot how I made a series of mistakes that seem—they don’t just seem dumb. They seem like the type of mistakes I could see myself having ridiculed someone else for having made.”

But because of those interviews, some experts say that it could allow prosecutors to point to inconsistencies to undermine his credibility with a jury.

“The defense is going to be completely boxed in by the prior statements SBF has made and the very incisive questions he has answered in the press and on social media,” said Renato Mariotti, a criminal defense attorney and former federal prosecutor.

FTX founder Sam Bankman-Fried (C) arrives at the Nassau, Bahamas, courthouse on Dec. 21, 2022. (Kris Ingraham/AFP via Getty Images)

“To the extent such payments are not returned voluntarily, the FTX debtors intend to commence actions before the bankruptcy court to require the return of such payments, with interest accruing from the date any action is commenced,” FTX has said in a statement.

FTX’s demise sent shockwaves through an already-battered cryptocurrency industry, which has seen a string of meltdowns this year that have taken down other key players including Voyager Digital and Celsius Network.

Other Details

Bankman-Fried was detained at The Bahamas Department of Corrections in Nassau, known as Fox Hill prison. The U.S. State Department in a 2021 report described conditions at the jail as “harsh,” citing overcrowding, rodent infestation, and prisoners relying on buckets as toilets, although Bahamian officials claim that conditions at the facility have improved since then.

Prosecutors alleged that Bankman-Fried’s illegal spending before the company’s collapse included millions of dollars in political contributions to mostly Democrat-aligned political action committees and candidates. He also made some donations to Republicans, officials have asserted.

Notably, reports say he dumped money into left-wing news outlets such as Semafor, ProPublica, and Vox. Another report indicated that he partially funded the nonprofit Guarding Against Pandemics, which was run by his brother, Gabe.

Some of the groups, candidates, and outlets have said that they'll return money that Bankman-Fried donated. On Dec. 20, ProPublica released a memo to its staff saying it planned on returning some $1.6 million of his donations.

And in December, Semafor co-founder Justin B. Smith said the startup media firm would allow “various government agencies” to determine “how best to handle” funding of the outlet. It’s not clear if Semafor will return the money.

Reuters contributed to this report.