Bahamian Securities Commission, the Prime Minister’s financial intelligence unit and a financial crimes unit are all involved in the FTX investigation.
The defunct cryptocurrency exchange FTX is the subject of a “active and ongoing” inquiry, according to the Bahamas Attorney General (AG) and Minister of Legal Affairs Ryan Pinder.
In a national statement that was delivered live on the Facebook page of the Office of the Prime Minister on Nov. 27, Pinder explained that the “affairs of FTX Digital Markets” are under scrutiny from both “civil and criminal authorities,” and Bahamian authorities are working with “a number of specialists and experts and will continue to do so as the need arises.”
“The Securities Commission, our financial intelligence unit, and the financial crimes unit of the Royal Bahamas Police Force will continue to investigate the facts and circumstances regarding FTX’s insolvency crisis and any potential violations of Bahamian law,” he added.
Pinder also stated that the relevant Bahamian authorities would work with international regulatory and law enforcement organizations while attempting to hold accountable any businesses or people who were found to have broken any laws.
“These events remind us of the lessons learned from securities and other financial regulation about the need for strong cross-border cooperation. The public worldwide will be best served by a strong international regulatory cooperation,” he said.
On Nov. 10, the Securities Commission of the Bahamas revoked the directors’ authority and suspended FTX Digital Markets (FDM) ability to conduct business. On November 12, they mandated that all FDM digital assets be moved to a commission-owned digital wallet for “safekeeping.”Pinder mentioned that additional protective measures taken by the nation’s regulatory body had been approved by the Supreme Court but she chose not to go into further detail until “we are confident that doing so will not jeopardize any aspect of the ongoing investigations.”
Pinder also used the occasion to criticize FTX Trading Limited’s emergency motion from November 17, which accused the “Bahamian government” of “directing unauthorized access to the Debtors’ systems” following the start of Chapter 11 bankruptcy filings in the US.
He defended all of the actions taken so far by the nation’s regulator and referred to the accusations as “extremely regrettable” for misrepresenting “the timely action taken by the Securities Commission”.
The Bahamas welcomed cryptocurrency businesses to the island nation to boost its economy, but after FTX’s crash, it has been unsettled. Additionally, the COVID-19 pandemic that began in 2020 and the hurricane Dorian in 2019 both severely affected its heavily dependent tourism-based economy.
Numerous jobs in the tiny country have been lost along with FTX. But, Pinder outlined his belief that despite the “personal tragedies” associated with the collapse of FTX, he expects “little contagion beyond the digital asset sphere both here in the Bahamas and around the world.” He cited a Standard & Poor’s rating for the Bahamas from November 22 that predicted a stable outlook and cited the performance of the tourism industry.
“Standards and Poor has projected a stable outlook for our economy resting in part on the assumption that there will be no material adverse impact on the Bahamas from the worldwide collapse of FTX,” Pinder said.
