Sam Bankman-Fried cofounded FTX in 2019 and is its CEO. Photo FTX
Sam Bankman-Fried may be in a little less trouble today as his former company FTX says it had $415 million of its missing funds stolen in a hack. The $415 million is part of a total of $5.5 billion the company says that it has found that can be recovered for its investors and depositors. This includes what FTX people described as the “unauthorized third-party transfers” $323 million out of the international arm of the business FTX.com.
FTX says that it has also found another $90 million taken from FTX US. If all of this money was indeed stolen then Sam Bankman-Fried is not responsible for its loss.
FTX’s new CEO John Ray said in a statement a finding the various funds saying, “We are making important progress in our efforts to maximize recoveries, and it has taken a Herculean investigative effort from our team to uncover this preliminary information.”
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As of today, Sam Bankman-Fried stands accused of eight counts of fraud and conspiracy. If convicted on all counts, he could be sentenced to as much as 115 years in jail. The charges came after his FTX cryptocurrency exchange company went bust a few weeks ago. He is currently out on $250 million bail and under house arrest at his parents’ home.
The big question over the fall of FTX is “what happened to all of the money that people left with the company?” FTX was a crypto bank, so to speak, a place where people could park their virtual assets. But unlike with banks, there is no regulation over the handling of cryptos and FTX is said to have moved people’s cryptos around, basically that the company spent their money.
And after FTX crashed creditors found that about $1 billion in funds were missing. Sam Bankman-Fried was accused of secretly moving $10 billion in FTX funds to trading firm Alameda research, which was founded by Bankman-Fried and thought of as a sister company to FTX. American prosecutors would like to prove that this was a case of embezzlement, while Bankman-Fried’s lawyers will surely try to claim it was simply an attempt to invest the funds to make more money.
