The Bahamas securities regulator and financial investigators are reportedly investigating the collapsed crypto exchange, FTX.
Financial investigators and the Bahamas securities regulators are looking into potential criminal activity related to the bankruptcy of cryptocurrency exchange FTX, according to a statement the Royal Bahamas Police Force sent to Reuters on November 13.
The Royal Bahamas Police stated:
“In light of the collapse of FTX globally and the provisional liquidation of FTX Digital Markets Ltd., a team of financial investigators from the Financial Crimes Investigation Branch are working closely with the Bahamas Securities Commission to investigate if any criminal misconduct occurred”.
The investigation comes after the regulator publicly denied FTX allegations over the weekend. On Nov. 11, the crypto exchange tweeted that it was instructed by “Bahamian HQ’s regulation and regulators” to facilitate the withdrawal of Bahamian funds.
A day later, the securities commission denied the crypto exchange the order or authorization to give domestic clients’ withdrawals top priority. The SCB’s Twitter page shared the following statement:
“The Commission wishes to advise that it has not directed, authorized or suggested to FTX Digital Markets, Ltd. the prioritization of withdrawals for Bahamian clients.”
According to a Nov. 9 Wall Street Journal article, both the Securities and Exchange Commission and the US Department of Justice are looking into the collapse of the cryptocurrency exchange.
Additionally, the California Department of Financial Protection and Innovation (DFPI) announced on November 10 that it has begun an investigation into the “apparent failure” of the exchange. Sam Bankman-Fried, the former CEO of the crypto exchange, is said to be in The Bahamas “under supervision,” along with Gary Wang, the co-founder, and Nishad Singh, the director of engineering.
On November 11, about 130 FTX Group entities, including FTX Trading, FTX US, operating through West Realm Shires Services, and Alameda Research, began the process of declaring bankruptcy in the United States. Bankman-Fried has also given up his job as CEO of FTX; John Ray will take over in his place. The former CEO of FTX’s institutional division, Zane Tackett, acknowledged on Twitter that the exchange currently owes $8.8 billion in liabilities.
