Sam Bankman-Fried, who founded FTX until a liquidity crunch forced the cryptocurrency exchange to declare bankruptcy, is escorted out of the Magistrate Court building after his arrest, in Nassau, Bahamas (Image: Reuters)
If Sam Bankman-Fried does not challenge extradition, FBI officials will accompany him to the US where he will appear at a Manhattan court
FTX co-founder Sam Bankman-Fried is planning to give his consent to extradition to the United States to face the criminal charges levelled against him following the fall of the cryptocurrency exchange, the Wall Street Journal said in a report citing people familiar with the developments.
Also Read: FTX Founder Sam Bankman-Fried, Once Hailed as Crypto King, Arrested in the Bahamas
Bankman-Fried has been charged with fraud and money-laundering offences. He has been accused of defrauding customers, lenders and investors and also of flouting campaign-finance rules by making illegal political contributions.
The report by the WSJ said Bankman-Fried’s plans could change.
He is scheduled to appear in a Nassau court for additional proceedings as soon as Monday.
He remains detained currently at the Fox Hill Prison in Nassau.
Once extradited to the US, he will make a court appearance in Manhattan where US District Judge Ronnie Abrams will preside over his case.
He could also make a bail plea. He was denied bail in the Bahamas earlier.
If Bankman-Fried does not challenge his extradition, agents from the Federal Bureau of Investigation will accompany him to the US, news agencies Reuters and WSJ reported.
FTX collapsed after reports surfaced that the global cryptocurrency exchange illegally transferred money to fund trades, which ran into massive losses and destroyed $10 billion of customer funds.
The new management that is running FTX says the company has lost more than $7 billion in assets.
US Attorney Damian Williams has said Sam Bankman-Fried may have committed ‘one of the biggest financial frauds in American history’, according to a report by CNBC.
Sam Bankman-Fried in several appearances to the media denied knowingly evaporating customer funds.
The authorities continue to claim that he used customer funds from the advent of FTX to support his hedge fund, make venture investments, purchase real-estate properties and donate to political parties.
The report by CNBC said that Sam Bankman-Fried was not allowed to indulge in rehypothecation.
Rehypothecation is the term used to describe businesses legally using customer’s assets to speculate and invest.
Bankman-Fried did not have permission to gamble with customers’ wealth as his own cryptocurrency exchange’s rules forbade him and his hedge fund Alameda to use customer money for anything unless the customer permitted the companies to do so.
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